The step into a new business field apart from real estate brokerage does not come as a complete surprise.
(Photo: Carsten Dammann for Handelsblatt)
Frankfurt The real estate agent Engel & Völkers enters the banking business. The Hamburg company announced on Tuesday that the licensing partner Engel & Völkers Smart Money is making “banking services available, especially for property owners and investors”.
The offer includes a free account to start with with a Visa debit card. There is also a fixed-term deposit offer as well as an “asset reporting”, which is supposed to show the value development of the property.
“With Engel & Völkers Smart Money, we are focusing on the financial needs of property owners and investors in particular,” said Kyros Khadjavi, managing director and CEO of the company. For banking services, they cooperate with the Berlin fintech Solarisbank, Engel & Völkers Smart Money itself is also based in Berlin.
Engel & Völkers’s move into a new business field apart from real estate brokerage does not come as a complete surprise. At the beginning of August, the brokerage house brought the financial investor Permira on board. The fund paid an estimated $ 400 million for a 60 percent stake in the company.
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Together, digitization and expansion are to be promoted, as company founder and supervisory board chairman Christian Völkers announced at the time in an interview with the Handelsblatt. Customers should stay in contact with the company for a lifetime beyond just buying real estate and should be able to exchange views on valuation questions, sales options, the market and other topics via a platform model.
On course for confrontation with established banks
With the now announced step into the banking business, Engel & Völkers is beginning to put its plan into action – and is on a confrontation course with many established banks that recently introduced bank fees for deposits in current and overnight accounts of over 50,000 euros.
Obviously one wants to seize the opportunity. Because in the real estate industry it is said that many Germans are looking for alternative investment opportunities out of anger about the fees – and find them on the real estate market.
The account offered by Engel & Völkers is free. The Visa debit card can be used to make cashless payments and up to four cash withdrawals per month worldwide without any fees. Payment functions via smartphone are planned.
For credits, for example from property sales, the Berlin company offers fixed-term deposits for short-term investments. Customers receive an interest rate of currently 1.0 percent per annum for three months. The minimum investment is 50,000 euros and the maximum is 100,000 euros. However, this offer only applies to customers who sell their property through Engel & Völkers or who sell part of their property through Engel & Völkers LiquidHome.
“We are creating a clear added value here, because it is not uncommon for property sellers to pay fees to other banks for their free liquidity before they invest again, for example in another property,” said the new Chief Commercial Officer Philipp Schemel.
Engel & Völkers advertises the account with a “360-degree view of the assets – including its own real estate”. To do this, all you have to do is enter key data such as location, year of construction, size, condition and date of purchase; a value indication is then determined based on statistical data and this is updated over time. Exclusive real estate investments are planned for the next stage of expansion. However, customers do not have to own a property themselves to use the offer.
More: Christian Völkers: “We’re not touching the brand, but are expanding the engine room”