Purchase of Kempers makes property services firm biggest in country.
Jones Lang Lasalle is set to buy Germany’s biggest retail agency, Kemper’s, for around €55m (£41m).The purchase of the nine-office firm, which makes JLL the largest property services firm by size in Germany, is part of a wider drive to improve its retail business around Europe.The sale will be completed in May, subject to regulatory approval, after Kemper’s concludes its association with JLL’s global rival, Cushman & Wakefield.
Alastair Hughes, JLL chief executive for Europe, the Middle East and Africa, told Property Week: ‘Germany is the second-largest market outside the UK for us in Europe. We believe the German economy is pretty well set. It had a torrid time two years ago but the property fundamentals are now positive going forward.’
‘We have a three- to five-year strategy to grow in certain areas but practically we can also respond to opportunities.’ Hughes said Kemper’s strength in high street investment and leasing would complement JLL’s strength in shopping centres: ‘This provides us with a full service in everything.’
The acquisition means JLL now has 500 members of staff in 10 cities throughout Germany and gives the firm exposure in areas such as Leipzig, Cologne and Hanover. Hughes said Kemper’s boss Gerhard Kemper and senior directors Rudiger Thrane and Jorg Ritter would retain senior positions at JLL and report to the firm’s chief executive for Germany, Christian Ulbrich.
The transaction comes just three days after Kemper’s severed ties with its former affiliate Cushman, which bought a 25% stake in the business in 2004. However, the tie-up led to an overlap of the pair’s capital markets business. Following the split Cushman said it had no plans to withdraw from Germany and was looking to increase its exposure in the country.
Paul Bacon, chief executive of Cushman for EMEA, said: ‘We’ve advised on €28bn (£20.8bn) of retail transactions in Europe and our German business is one of the most profitable within that.
We felt we would cannibalise our business so we chose not to continue with Kemper’s.’Bacon said future purchases in Germany were likely to be of smaller, regional firms.
By Jonathan Brasse and Mike Phillips, Estates Gazette, 01/02/2008