Sell the property completely or partial sale with investment?

Besides all the cost and technical aspects, I especially wonder whether it fits into the residential area. Around it are many former GDR panel buildings, all of which have been modernized and are well, if not fully, occupied. There are many retirees because our parents' generation stayed living there. It's not the Flodder family living there, like in Gorbitz, but rather the Schulze and Schmidt families. If a lively bunch of young students moves into the neighborhood, can that work?

I have no idea about the location. BUT: Do students even want to live there? In other words, is the location suitable?

Recently, I had the refinancing of such a complex in Magdeburg on my desk. Also a university city with many other research institutions. The property was simply in a location wrong for students—a residential area with nothing around it. The result was increased vacancy and high turnover. Competition (which was significantly cheaper) were the apartments of the student services.

So far, I have only seen such properties from professional clients who know what they are doing.

Finally, a note on financability. If you can’t find a bank that doesn’t really care about the loan-to-value ratio, a fair amount of equity will be required. If the property is rented out en bloc by you to a commercial operator, the loan-to-value should be about 11 to 11.5 times the sustainable rent. If the apartments are rented out and managed individually, the loan-to-value is at most 14.5 times. It would probably cost you around 15 times (including the land).

I have no idea about the location. BUT: Do students also want to live there? In other words, is the location suitable?

That is precisely the question. The connection to the university is great (bus right outside - 4 stops) - but otherwise? As a teenager, you probably want to live more in the Neustadt, where life is bustling and every alley has a different pub with a disco and cinema. On the other hand, it is said that it is no longer as cheap there as it was 20 years ago. Besides, it takes half an hour from there to get to the university. But once you've built such a bunker, you can hardly switch to a nursing home anymore.

A consultant just came up with the idea of offering student dormitories.

I wonder how many "fleas in their ears" your relatives still want to catch before they let a development team work on it. Student housing is not a bad idea in itself, but homogeneous usage concepts have not yet occurred to me as "appropriate" throughout the course of the thread. Special-needs properties for different resident clientele are an exciting field, in every respect. You certainly don’t develop a property by continuing to collect a colorful bouquet of concept visions for years. Especially not because, as the years go by, the existing tenants give up and the cards are reshuffled forever.

I wonder how many "fleas in the ear" your relatives still want to accumulate before they let a developer team handle it.

I don't know either. But we are not on the run.

Student housing is not a bad idea in itself, but homogeneous usage concepts haven't come to my mind as "suitable" over the course of the thread.

Homogeneous usage concepts? Elephant! Speak German!

You certainly don't develop a property by collecting a colorful bouquet of conceptual visions for years to come.

Oh, we'll see. I always sense a touch of haste in you. But it completely rolls off me...

Especially not because as the years go by, the existing tenants give up and the cards are shuffled forever.

We are 90% existing tenants ourselves. Or did I misunderstand you now?

Homogeneous usage concepts? Elephant! Speak German!

Well, quite simple: no students OR seniors OR, but AND. Living, aftercare, social issues, etc.

I always sense a touch of hecticness in you.

I am the epitome of calm. The art in such projects lies in bringing several expert eggheads to the table. They won’t have time next quarter. You should basically know months in advance when you will have had enough sleep.

We ourselves make up 90% of the current tenants. Or did I misunderstand you now?

No, then I misunderstood you. I had so far thought that the current tenants to be considered were mostly third parties.

If the city allows it why not! They go elsewhere to party. Your nephews can move in with the brats right away. Who is supposed to finance this thing?