Real estate

Experience in property investments across Germany

EnTerra Holding GmbH is a German based real estate holding company currently managing over €40,000,000 worth of German residential and commercial property.

The company is managed by a strong and experienced multi-disciplinary team focused on maintaining and expanding its current portfolio of well let, high yielding property investments across Germany.

EnTerra applies a strict property selection process that aims to ensure properties are purchased at attractive prices, with strong and verifiable historical cash flows.

Real estate map of Germany

Investments strategy

EnTerra’s investments display a number of key characteristics, such as favourable purchase prices, elevated rental yields and sustainable cash flows.

EnTerra’s main focus lies in the identification of well maintained properties with little or no backlog in renovation and the development of a portfolio that is well balanced between smaller residential parks and larger complexes. Investments are made with a view to achieve a well diversified portfolio, both on a geographic and demographic basis, minimising the investment risk profile.

EnTerra applies a hands-on approach to the day to day property management process, with the aim to significantly enhance value, while minimising downside risks, in co-operation with expert local partners.

The investment cycle is expected to cover a timeframe of 4 to 7 years.

Investment rationale

The German residential real estate market provides excellent opportunities for the development of a real estate portfolio supported by key trends:

Opportunities

  • Positive Cash Flow
    The investments produce positive cash flow from year 1 with rental income yields of 7% – 12%.
  • Sustainable Cash Flow
    Investments in residential properties facilitate a constant cashflow that is largely independent of the current economic situation and features a low risk profile.
  • Cost
    Purchase price significantly below new construction costs
  • Distressed Acquisitions
    Off market transactions generated by pressure on forced sellers
  • Investment timing
    Attractive prices / buyer‘s market
  • Relative Value
    Lower asset prices, particularly when compared to other major European countries
  • Valuations
    German Property Market has suffered less than others

Key Trends

  • Stable Demand
    Rising number of households and increasing living space per inhabitant counterbalance current population stagnation, particularly in larger cities
  • Rising Rents
    A reduction in the number of completed new builds leads to a shortage in supply and therefore to increasing rental prices
  • Value Increases
    Potential to increase value through active portfolio management and general property value appreciation
.

  • Attractive Transaction Sizes
    EnTerra targets middle market transaction sizes in the EUR 1 to 20 million range, resulting in less competitive pressure from individuals on the low-end and large buyers at the high end.
  • Proprietary Dealflow
    Leveraging of its network of local contacts, EnTerra ensures itself access to properties that are not subject to highly competitive auction processes.
  • Reasonable Purchase Prices
    EnTerra ensures that transactions are closed at reasonable prices, assuming conservative financial projections for future rental income. This approach prevents EnTerra chasing up prices and results in interesting rental yields and strong debt servicing coverage ratios.
.

  • Timely Execution Process
    EnTerra is able to perform a rigorous and efficient due diligence on potential properties for inclusion in the portfolio and execute transactions in a timely fashion.
  • Optimal Capital Structure
    EnTerra strives to achieve the best possible capital structure when financing its transactions. Through its close relationship with financing partners, EnTerra is able to obtain attractive financing terms in the market.
  • Value Enhancement
    EnTerra aims to achieve active value enhancement of the underlying real estate through a combination of maintenance and development, reduction in operating costs, vacancy reductions where required and reasonable rental increases.

Berlin RiedingerstrBerlin, Riedingerstrasse

Assisted-living residential complex dating from the 1970s, and let in its entirety to Deutsches Rotes Kreuz (German Red Cross). The complex is arranged as a terrace overlooking spacious gardens.

Chemnitz-HAbschmannstr.1Chemnitz, Hübschmannstrasse 19

Residential building constructed between 1910–1912 in the “Jugendstil” design. The building was renovated to a high specification in 1995, including a fifth floor modern extension.

Chemnitz, Irkutsker StrasseChemnitz, Irkutsker Strasse 233–247

Terrace of residential buildings of “plattenbau” construction and dating from 1974. Facades, Roof and Common parts renovated in 1999/2000, and approximately half of apartments renovated internally. Part-ownership with 55 apartments being purchased out of 85 in total.

Chemnitz,-Untere-Aktienstr.Chemnitz, Untere Aktienstrasse 7

Part residential and part commercial building constructed in 1885, and renovated in 1994. The basement and ground floors are occupied by retail units, the first and second floors are let to offices and the last two floors are residential.

Giessen, PlockstrGiessen, Plockstraße 11

Residential and commercial four storey building with shops on the ground floor and residential units above, built in 1900.

Penig,-SchlossplatzPenig, Schlossplatz 8-10

The property is situated in the center of Penig and is a part residential, part commercial building.

Intern

Ralph Butters, CEO

  • Real Estate Investments of over EUR 400 million in Germany
  • Private Equity and Exchange Traded Securities Management (traditional and alternative asset classes)
  • Investment Banking with Credit Suisse First Boston and Wasserstein Perella (Mergers and Acquisitions and Leveraged Finance)
  • University of Cambridge, Mathematics (Certificate of Advanced Mathematics & Master of Arts)
  • Founded EnTerra in 2006
  • Born 28.11.1976

Stephan Lütkehoff, CFO

  • Meihoff Real Estate, Director, Advisory and Marketing
  • ReValue Gruppe, Project Manager, Real Estate Transactions
  • November Capital, Private Equity, Associate, Real Estate and Distressed Investments
  • Degree in Economics with focus on Retail Management
  • Joined EnTerra management in 2013
  • Born 17.3.1978

Alexander Priske, Legal Counsel

  • Practising since 1997, with a focus on Real Estate Law and Banking & Mortgage Law
  • 1. / 2. Juristisches Staatsexamen
  • Degree in Law from Humboldt Universität zu Berlin
  • Counsel to EnTerra since 2011
  • Born 20.3.1968

Extern

  • Property Management
    EnTerra works hand in hand with local property management companies to perform the daily operational property management and interaction with the tenants
  • Engineering / Environmental
    – Team of trained architects / surveyors
    – Confirm structural integrity of assets / absence of contamination
    – Determine required capital expenditures
  • Audit
    – Detailed confirmation of cash rental payments at single tenant level
    – Expert opinion, focus on historical stability of Income & Expenses
  • Valuation
    – Top tier professionals
    – Extensive track record in German market