In today’s complex and fragmented European real estate market, opportunities are available if you are able to recognise them and are willing to do the hard work. But to see and recognise them you need to have your “boots on the ground,” your “hands on the data,” and your “head in the realities of the local market’s engine rooms.” In Germany, particularly, I’ve come to see that the greatest value is not just found but created, through rigorous granular origination and disciplined active asset management. That is the strategy we’ve embraced at Arrow Global, and it’s one I believe that offers the best chances of value creation.
The macro picture is clear: capital is scarcer, investment appetite is more cautious, and yet we are still contending with the residue of an era of cheap debt. For years, developers across Germany leveraged heavily, pushed by negative Bund yields and artificially low cost of capital, and motivated by the fear of “missing out.” Now, with the tightening of monetary policy, the fallout has materialised in the form of stranded assets, distressed sales, and fragmented insolvency processes. It’s a moment of price dislocation, but also of courage and precision in deal making.
What’s emerging is not a wave of institutional-grade portfolio sales, but a granular landscape of individual distressed situations – assets caught mid-development, platforms struggling post-insolvency, and properties that are functionally viable but structurally misaligned with current capital stacks. This is not an environment for passive capital or arm’s-length investing. It is a cycle that rewards those with local operating capabilities, underwriting rigour, and the agility to intervene where traditional players hesitate.
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