Immobilien Zeitung: Mr. Schmitt, after Mach 2 in Hamburg—what is your next flagship project?

Oliver Schmitt: When realizing a project like Mach 2, which involved a lot of pioneering work due to the lack of previous experience, many factors must align. It requires careful pre-development, but also time. We are currently working on a location that we believe holds great potential. However, it’s not about simply executing unique real estate projects; we aim to develop solutions that meet the needs of both users and municipalities. Mach 2 addressed the space shortage in metropolitan areas with high, ongoing demand.

IZ: Mach 2 received a lot of praise—even from competitors. Does that inspire you?

Francisco J. Bähr: Yes, it does. We are proud that the project is being positively received. Those of us at Four Parx who are dedicated to the design and development of innovative logistics properties are constantly seeking visionary solutions to industry challenges, be it new mobility solutions, alternative energy supplies, or compact space planning. When projects like this succeed despite numerous challenges—such as difficult soil conditions during the development of Mach 2—we can be genuinely pleased.

IZ: However, there was some criticism. Some said, “Mach 2 is way too big, too bulky, and most users in Germany don’t need something like this.” How do you respond to that?

Bähr: It’s not about creating a real estate concept that meets the needs of all users in the market. In my view, that’s impossible and not effective. That’s why Four Parx has a diverse portfolio tailored to individual user requirements. Many users in Germany may not need a property like Mach 2. However, for users looking for rental space in costly, limited-space locations like metropolitan areas, multi-story properties will eventually become unavoidable. That’s precisely why we developed Mach 2. The fact that it was fully leased before completion shows we made the right call.

IZ: Implementing the project faced issues with soil, water, and unexploded ordnance. Was Mach 2 still profitable for Four Parx despite these costly obstacles and delays?

Schmitt: True, due to Hamburg’s history of heavy bombing in WWII, extensive unexploded ordnance inspections were necessary. Until the findings were safely assessed and removed, the entire area had to be closed off. Additionally, the unique soil characteristics near Hamburg harbor required special solutions and foundations. These factors brought additional costs, but most were budgeted. In the end, Mach 2 was still a financial success for Four Parx.

IZ: Will you keep the property or is a sale planned?

Schmitt: As a developer and manager, we also hold properties. However, we typically plan to sell the projects we develop. Mach 2 was fully transferred to the fund of our project partner, the asset manager AEW, after completion.

IZ: How did you finance it? Did the banks participate?

Schmitt: Our partner played a crucial role in financing as well. The project was 100% funded through an AEW fund.

IZ: The final costs were 215 million euros. Would you undertake the project again?

Bähr: Given that the value of Mach 2 after completion and leasing exceeded the costs, we would undertake the project again anytime. Additionally, with the experience gained from this pilot project, we could build such a property more affordably today. However, we would handle some aspects differently, such as fire protection. During Mach 2's construction, we had to meet many requirements that, in hindsight, were unnecessary. Now, with our prototype, we can show which measures are truly effective. It’s worth remembering that none of the participants had experience building such a property at the time.