Goldman Sachs Group Inc. is buying 93,000 apartments from the German state of North Rhine-Westphalia for €787 million ($1.2 billion) in cash to take advantage of rising rents.

The takeover of state-owned Landesentwicklungsgesellschaft's (LEG) apartments, valued at about €3.4 billion including debt, will be carried out by Goldman's Whitehall real-estate funds, state finance minister Helmut Linssen said on Wednesday at a briefing in Dusseldorf.

The deal, which follows months of bidding, marks the largest property transaction in Germany since the beginning of the financial market turbulence, according to media reports.

The purchase is one of few large property transactions to complete since the advent of the credit crunch last summer. Goldman Sachs beat rival bidders Deutsche Annington, the German property company controlled by UK investor Terra Firma, and Irish investor Tomkin Estates with German fund manager Corestate Capital.

A consortium of Apollo Real Estate Advisors, Brack Capital and Lehman Brothers was an early bidder for the company but pulled out of the battle in the spring.

The price includes about €79 million worth of loans from stakeholder BVG, the finance ministry said. The government's share of the transaction is valued at about €700m, as LEG has €2.7 billion of debt.

Of the purchase price, some €473.6 million will go to state-owned investment vehicle BVG, while the remaining funds will be moved to NRW Bank, which is 64.74 percent owned by the state, and Deutsche Rentenversicherung Westfalen.

Goldman Sachs presently manages €15 billion of property in Germany.

The Goldman Sachs Group, Inc., or simply Goldman Sachs, is a leading global investment banking, securities and investment management firm. Goldman Sachs was founded in 1869, and is headquartered in the Lower Manhattan area of New York City.

Goldman Sachs acts as a financial advisor to some of the most important companies, largest governments, and wealthiest families in the world. It is a primary dealer in the US Treasury securities market. Goldman Sachs offers its clients mergers & acquisitions advisory, provides underwriting services, engages in proprietary trading, invests in private equity deals, and also manages the wealth of affluent individuals and families.

The group posted revenues of $88 billion last year and has been relatively untouched by the current financial crisis that has claimed heavy casualties amongst its peers.