Ping An Insurance (Group) Co., China’s second-largest insurer, has submitted a bid for The Squaire building in Frankfurt, people with knowledge of the matter said.
The Squaire, a ship-like office and hotel complex perched atop the train station at Frankfurt airport, could fetch as much as $1 billion, said one of the people, who asked not to be named as the information is private. IVG Immobilien AG, which built the property in 2011 for more than 1 billion euros ($1.24 billion), has hired CBRE Group Inc. to manage the sale, the people said.
Chinese companies may spend as much as $15 billion on overseas property purchases this year, encouraged by a depressed residential housing market, Knight Frank LLP wrote in a report earlier this month. Ping An made its first real estate acquisition outside China last year when it bought the Lloyd’s of London tower for 260 million pounds ($407 million), people with knowledge of the matter said at the time.
The Chinese insurer sent a team to Frankfurt last month to inspect The Squaire, according to one of the people. It has been in touch with Deutsche Bank AG about financing the potential purchase, the person said.
A Qatari fund is also among bidders for the building, one person said. BlackRock Inc., Blackstone Group LP and Tishman Speyer Properties LP have submitted offers for the complex, people with knowledge of the matter said last month.
The Squaire has a total floor area of 140,000 square meters (1.51 million square feet) and is home to auditing firm KPMG LLP, German carrier Deutsche Lufthansa AG and two Hilton Worldwide Holdings Inc. hotels, according to its website. The nine-story building was valued at 807 million euros in IVG’s 2012 annual report, the most recent year available.
IVG, once Germany’s biggest property company by market value, was taken over by creditors in August after demand for its buildings fell in the wake of the financial crisis.
A representative for Ping An, who asked not to be named citing company policy, couldn’t immediately comment. Harry Thompson, a Hong Kong-based spokesman for CBRE, and Deutsche Bank spokeswoman Candice Sun declined to comment.
–With assistance from Zhang Dingmin in Beijing and Dalia Fahmy in Berlin.