Portfolio Development

Holistic portfolio optimisation

The global capital market is currently in choppy waters across all asset classes - this challenging environment of pressured returns in the real estate sector, falling bond and share prices as well as increasing regulatory requirements (ESG, CRR III, Solvency etc.) is currently presenting all investors with major challenges in setting up a crisis-resistant investment portfolio. As part of our Portfolio Development service, we take a close look at your real estate portfolio from a technical and economic perspective, taking into account your return targets, and develop sustainable strategies and optimisation measures in line with regulatory requirements

What we can specifically do for you

  • Yield targeting: Identification of technical and economic optimisation potentials of your portfolio
  • ESG-Targeting: Identification of suitable optimisation potentials with regard to the EU taxonomy criteria and the Paris climate protection targets
  • Development of corresponding measures in accordance with the desired target returns
  • Identification of building and utilisation potentials (including extensions, land reserves, conversions, conversions) and strategic control of implementationIdentifikation
  • Comprehensive business plan simulations at property level as a decision-making basis for your investment projects

What benefit you receive

  • Interdisciplinary understanding with solution and interface competence for real estate management and real estate technology issues from a single source
  • Portfolio and property-related results for prioritising maintenance measures, for example within the framework of climate protection and refurbishment roadmaps
  • Concrete proposals for technical and economic optimisation options to comply with the Taxonomy Ordinance and ESG requirements
  • A strategic sparring partner at portfolio level with an entrepreneurial mindset
  • Long-term stabilisation of the portfolio with the best possible performance

FAQ Portfolio Development

Which measures have the greatest economic leverage, taking into account the target return and regulatory requirements?

The current challenging environment of yields coming under pressure in the real estate sector as well as increasing regulatory requirements (ESG, CRR III, Solvency, etc.) increases the necessity to deal with the active management of one's own portfolios. It is advisable to sharpen the focus on risks and potential returns in the portfolio in order to be able to ensure the desired target return. A holistic view of the property from a technical, economic and regulatory perspective helps to identify those measures that have the greatest leverage for achieving the return targets and maintaining value in the long term.

What are the consequences for my portfolio due to changes in financing conditions?

On the one hand, rising interest rates mean that alternative asset classes such as bonds are becoming more attractive and real estate investments have to face this competition in asset allocation. On the other hand, they lead to higher financing costs, which can lead to correspondingly lower returns on equity. This affects real estate investments in particular, which are often financed with a considerable amount of debt capital.

It is therefore advisable to already take a look at the time of the end of the fixed interest rate period and to simulate the possible effects on the yield level due to the changed interest rate level on the portfolio performance.

In addition, due to the current economic conditions, it can be assumed that the interest rate level will remain at a higher level in the future, which could possibly lead to devaluations of the properties concerned and thus to losses in value.

How can potential ESG risks be identified at an early stage and what measures need to be taken to prevent so-called "stranded assets" at an early stage?

The EU taxonomy defines which economic activities can be classified as environmentally sustainable. Therefore, ESG criteria are also becoming more and more important in the real estate industry due to regulatory and legal requirements. The real estate industry is thus faced with the major task of focusing on the transformation of its portfolios towards greater sustainability. It is therefore advisable to identify today the point in time when individual properties and portfolios no longer comply with the requirements of the German Climate Protection Act and the Paris Climate Agreement with regard to the specified CO2 emissions and become so-called "stranded assets". This can pose a high risk for future transactions, new leases or financing, as the affected properties may continuously depreciate or, in the worst case, no longer find tenants and buyers on the commercial real estate market and are thus no longer tradable.

Let's talk about how we can support your project

Profilbild von Mario Kolb

Mario Kolb MRICS