CICT's Gallileo property, the English Theatre Frankfurt and Commerzbank

CapitaLand Integrated Commercial Trust's (CICT) property in Frankfurt (Germany), Gallileo, is at the centre of a kerfuffle between a theater company, German government ministries and Commerzbank.

What is the Gallileo?

This is a freehold Grade A commercial property, in the prime Central Business District (CBD) of Frankfurt, Germany. It was acquired at an agreed property value of €356.0 million (approximately S$569.6 million) (on 100% basis). CCT (as CICT was known pre-merger of Capitaland and Ascendas) will hold a 94.9% stake and CapitaLand will hold the remaining 5.1% stake in the Gallileo property through a special purpose vehicle.

The main tenant is Commerzbank, one of Germany's biggest bank, leasing 100% of the property. They came to be the main tenant because they took over Dresdner bank in 2009. Building of the Gallileo started in 1999 and ended 2003.

According to the old slides in 2018 at the time of CICT's acquisition, "Commerzbank AG's lease expires in 2029 and the rent is adjusted based on an inflation index every two years. However, Commerzbank AG has an option to terminate the lease in 2024 with 24-months’ notice".

Based on the 1Q2023 Business Update slides, it was stated "The existing lease with Commerzbank will terminate in January 2024. CICT manager is exploring plans for the property."

What is the English Theatre Frankfurt?

This is a theatre founded in 1979, and in 2003 moved into the Gallileo, as Dresdner bank was it's patron.

What's happening now?

Based on this Financial Times article, Commerzbank is seeking to evict the English Theatre Frankfurt (ETF) from the Gallileo. 

Apparently, when the Gallileo was built, Dresdner Bank struck a deal with the city to include a playhouse with 300 seats. As Dresdner bank was absorbed by Commerzbank, this arrangement carried on, and Commerzbank has sublet the space to the ETF.

Now that Commerzbank is leaving the building, Capitaland wants the space back for a 18 month long refurbishment. To do so, the entire building must be empty, including the playhouse.

The ETF and the city government believes that this agreement still stands, that the basement of the building should be used for cultural purposes.

Impact to CICT

We do not know how this will develop but looking at the 1Q2023 business updates slides, Commerzbank contributes 1.8% of Total Gross Rent as of March 2023.

Miscellaneous stuff

The Gallileo is one of the tallest buildings in Germany and there are videos of the interior.

Here is a video of some guy who climbed to the top in 2018 and took pictures


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