Allianz, CBRE GIP back €1bn European student housing fund

International Campus has launched €1bn student housing fund with €600m already raised from Allianz and another European investor.

The Fizz Student Housing Fund is intended to operate as a long-term investment vehicle and will help accommodation specialist International Campus expand across Europe.

German insurer Allianz and an unnamed investor, represented by CBRE Global Investment Partners, provided cornerstone capital for the first close of the fund.

The Fizz Student Housing Fund is named after International Campus’ The Fizz brand, which provides accommodation for students and young professionals.

International Campus, which is already active in Germany and the Netherlands, plans to expand into Austria and to have more than 15,000 apartments under management by the end of 2020.

The new fund is being seeded with four fully leased German properties containing 1,200 apartments in Berlin, Darmstadt, Frankfurt and Hanover.

It is also acquiring four project developments with more than 1,600 apartments in Aachen, Frankfurt, Hamburg and Cologne. Preparations are underway for the acquisition of further investments.

International Campus will co-invest in the Luxembourg-domiciled fund and manage the assets.

The fund, which will have an equity ratio of 70%, has an initial term of 10 years, which can be extended by its investment committee.

Olivier Téran, CIO of Allianz Real Estate, said: “We see student housing as an attractive growth market with an appealing risk/opportunity profile and considerable development potential.

“In recent years, International Campus has impressively demonstrated that it has the necessary skills for the acquisition, development and operation of projects in the student housing segment.”

Rolf Engel, chairman of the supervisory board of International Campus, said: “Demand for the new fund and the decision of Allianz clearly show that well-managed, high-quality residential buildings for young target groups have long since become an attractive asset class in their own right for large institutional investors.”

Institutional investment in student housing has been gaining momentum in recent months. Just this week, Hines moved into the Irish market on behalf of German pension funds and PensionDanmark made its first major student-housing deal.

Earlier this year, Singapore’s sovereign wealth fund GIC begun investing in student housing in the UK and Germany with specialist operator GSA.