Wealthy investors aiming for substantial profits target Berlin.
A gathering of influential individuals in the financial industry takes place in Berlin. Though barely recognized by the public, their investments leave significant impacts within Germany.
Managing a whopping $50 billion, the companies attending this crucial meeting, often labeled as financial investors, hold power that surpasses major banks. While they may gather unnoticed, their immense influence in the financial world is undeniable. Every year, the private equity summit known as SuperReturn International takes place in the German capital, attracting the top brass from these organizations.
The lineup for this year's convention includes billionaires like David Rubinstein, co-CEO and co-founder of Carlyle Group, whose assets under management exceed $400 billion, and his personal net worth sits close to $4 billion. Blackstone, a leader with around $1 billion in assets under management, sends multiple high-ranking individuals. A mix of pension funds and insurance companies also participate as investors.
Public knowledge of events like SuperReturn pales in comparison to the World Economic Forum in Davos, set against a picturesque backdrop in the Alps. However, staying true to its name, SuperReturn isn't just a conference but an entire industry wherein private equity managers seek out double-digit percentage returns - a feat that might be attainable while investing in stocks over a longer period. How these methods and investment forms contribute to such gains is a hot topic at the Berlin summit, with seminars, panels, and workshops aiming to uncover the secrets.
Housing Market Abuses by Financial Investors
Jorim Gerrard, who monitors the industry for the Finanzwende citizen's movement, criticizes the prevailing indifference towards the meeting and the private equity industry itself. He maintains that they handle not only such staggering amounts but also frequently purvey their monies into crucial sectors of public well-being: healthcare facilities, medical practices, and the housing market. The result? Significant consequences, as Gerrard puts it, are evident in the SuperReturn's influence over Berlin's property sector.
Blackstone, the biggest commercial landlord globally, owns a minimum of 3,700 flats in the German capital. Heimstaden, a Norwegian financial investor, entered this market in 2018, now ranking as the city's second-largest private apartment manager. Carlyle shelled out millions for some Berlin apartment complexes.
All players share a common trait: the desire to produce "super profits" heavily dependent on taking harsh measures like high-end renovations, transforming properties into condominiums, and escalating rent prices. They refrain from investing resources into new construction, says Gerrard. Their aggressive tactics worsen the ongoing difficulties faced by cities such as Berlin.
Despite his criticism, Gerrard does not demonize the financial investors completely. However, he contends that investing in areas like social security "is not acceptable," adding that citizens usually cover these expenses. Instead, he suggests that these individuals focus their ambitions on riskier markets.
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Financial investors, including giants like Blackstone and Carlyle Group, frequently invest in Berlin's real estate market, focusing on apartment buildings. Private equity firms, such as Heimstaden from Norway, enter the market seeking high profits, transforming properties and hiking rental prices, often at the expense of local residents.
Source: www.ntv.de
