Unidentified suspects set fire to an uninhabited center for asylum seekers in the eastern German town of Meissen, police said Sunday.
The building was vacant at the time and a police spokesman said that the fire broke out shortly after midnight on the first floor.
A police unit in Leipzig that is responsible for crimes by extremists is handling the investigation.
A spokeswoman said that preliminary investigations showed the presence of fire accelerators at two locations in the center, but the fire broke out only in one area. It was also found that the building was broken into.
The center is meant to house about 32 asylum seekers in Meissen, which is about 25 kilometers north-west of Dresden.
Police were investigating whether right-wing extremists were behind the attack, as their presence was reported in the town the previous evening.
An anti-refugee "homeland security initiative" had called for a "spontaneous gathering" in Meissen on Saturday night.
There were protests last week against asylum seekers in the town of Freital, outside Dresden, which the government said was "stoking xenophobia."
Some 160 people gathered Wednesday at the entrance to a hotel-turned-refugee center in Freital, jeering and insulting new arrivals, including women and children.
The former Hotel Leonardo is home to about 100 asylum seekers, with tensions between the refugees and residents growing for the past several weeks.
Germany is facing an unprecedented influx of migrants - mainly from Syria, Afghanistan, Iraq, Serbia and Kosovo - and there have been several attacks on asylum shelters in recent months.
About 40 per cent of the 186,000 migrants that registered in the European Union in the first quarter of 2015 are seeking asylum in Germany, according to Eurostat.
There has been a rise in arson attacks this year on asylum seekers' homes.
Official data shows that there were 175 racially motivated attacks in Germany in 2014, compared to 58 the year before.
In February, a 39-year-old German man set fire to an unoccupied building intended to house asylum seekers in Escheberg. He admitted to the crime and said he was protecting his family from the six Iraqi men that were supposed to take up residence there a day later.
In April, six people were injured in a fire at an asylum seekers' home in the eastern city of Chemnitz, then home to 30 residents.
Earlier that month, a refugee home in Hamburg was set ablaze. Located in an industrial part of the city, the complex of 16 industrial containers accommodated young refugees who had travelled unaccompanied to Germany.
Another fire was set, also in April, at a home intended for asylum seekers in the town of Troeglitz.
Troeglitz, in eastern Germany, hit the headlines earlier this year when residents staged protests against the planned asylum seekers' home, which was supposed to house 40 refugees.