One Of Europe's Biggest Property Assets Asks For Debt Extension Amid Value Drop
The owners of a giant mixed-use building in Frankfurt are close to securing a three-year loan extension as the value of the scheme falls and the biggest tenant prepares to leave.
A consortium including London-based AGC Equity Partners and Korean investment firm Hana Financial Investment has requested the extension to a €510M (£440M) loan secured against the 2.1M SF Squaire office building next to Frankfurt Airport.
The securitised loan matured in December and will now be extended to March 2029. In return for the extension, the owners will make an extra repayment when the loan matures or is refinanced.
The servicer of the loan said the owners secured informal agreements from 75% of the bondholders to grant the extension, meaning the request is likely to be approved. A one-year loan extension was already granted in December 2024.
The building comprises 1.5M SF of office space, two Hilton hotels and more than 3,000 car parking spaces. At 660 metres long and 65 metres wide, it is a groundscraper that is one of the biggest single buildings in Europe.
The AGC consortium bought the building for €1B in 2019 from Blackstone, which acquired it after buying its distressed developer, IVG, in 2016.
The loan secured against the building was securitised in 2021, by which time the value had dropped to €829M. It was revalued at €757M in 2024, but ratings agency S&P estimated the value could be around €427M. No 2025 valuation was undertaken.
The hotels are performing well, although revenue from both reduced in 2025. But the office element is 25% vacant, and KPMG, which accounts for 59% of the office rent, is moving out in 2028. That will give the owners about 450K SF to fill.
