Zurich Alternative Asset Management (ZAAM) has established a core US real estate fund for European pension funds and has already acquired four assets.
Managing director Sean Bannon told IPE Real Assets that it was ZAAM’s first real estate fund for third-party investors and it had an investment capacity of $500m (€408m).
ZAAM is a New York-based alternative investments arm of Zurich Insurance Group, focused on hedge funds, private equity and US real estate.
Bannon declined to disclose the identify the investors or the name of the new fund.
“These types of investors look at core real estate in the US as an attractive investment when they are compared to many fixed-income products in their portfolios that are producing negative returns,” he said.
The fund is for the time being not open to US institutional investors.
ZAAM has already begun to make investments, most recently paying $30m for the 300 West Summit office building in Charlotte. It also owns a $30m industrial property in the city.
The fund closed on another office deal in December last year, paying $52.1m for the Terry Thomas office building in Seattle.
The fourth asset is a Whole Foods-anchored shopping centre in Coral Gables, Florida, which was bought for $45m.
ZAAM plans to stick to the four main property types of office, retail, residential and industrial, and intends to invest in housing this year.
The fund is targeting opportunities in markets on the East and West Coasts of the US, as well as Nashville, Chicago, Austin, Houston, Salt Lake City and Minneapolis.