Bayerische Versorgungskammer (BVK) has given Deutsche Asset Management €750m for a new vehicle targeting European and US real estate debt.
The fund will focus on stretched senior loans and subordinated loans with blended target returns in excess of 4%.
The announcement comes two weeks after IPE Real Estate reported that the €70bn institution was planning to invest €3.6bn in a number of real estate strategies.
Loans will be secured against income-producing, institutional-quality assets, with a portion of the fund allocated to development funding.
Targeting deals mainly in Europe and the US, investments are expected to be between €50m and €250m per loan.
Andrea Vanni, head of European debt investments at Deutsche Asset Management, said: “This new mandate, alongside our €750m European senior loan fund, allows us to provide junior and stretched senior capital on large European and US transactions.”
The new mandate will bring the total volume of Deutsche AM’s real estate debt business to €2bn.
Clemens Schaefer, CIO and head of portfolio management for European real estate, said: “This capital raise demonstrates the growing demand for real estate loans by alternative lenders.”
