GERMANY – The €55bn German Bayerische Versorgungskammer (BVK) has joined forces with Deutsche Hypothekenbank to co-finance commercial real estate.

Both companies signed a framework agreement on the BVK co-financing loans acquired by Deutsche Hypo.

The initial target volume was set at €500m, and the agreement has been made for an indefinite time horizon.

The co-financing project will focus on "selected" assets in the office and retail segment, as well as selected residential portfolios in Germany.

André Heimrich, BVK board member and head of asset management, said the investments would focus on core assets in the office and retail space in the top German cities.

In a joint statement, the two parties noted the financing for the loans would be shared in equal parts.

Deutsche Hypo described the joint venture as an "innovative financing solution" and the first of its kind.

Heimrich added that, with this deal, the BVK aimed to "continue on the path we started on with financing the Silberturm in Frankfurt in 2011".