DWS has acquired a residential development in Copenhagen for its pan-European core real estate fund.
The residential complex, comprising 361 modern, small and medium size apartments has been purchased for Europe II, an open-ended institutional fund.
The apartments, aimed at families and young professionals, are located in the developing residential area of Brønshøj-Husum in the north west of Copenhagen.
DWS said the area had excellent amenities including schools and recreational areas and good connectivity to Copenhagen’s city centre.
The investment, it said, will “take advantage of the high demand for smaller rental apartments and strong rental growth driven by demographic changes and urbanisation”.
The acquisition increases the fund’s exposure to the Nordic region, adding to a Swedish prime logistic asset purchased in 2021.
Nicoletta De Bona Bottegal, lead portfolio manager for Europe II, said: “As an affordable residential scheme, the Danish acquisition provides an opportunity to benefit from rapid growth of the Greater Copenhagen area and aligns well with the fund’s strategic focus to invest in core and core-plus assets.
“The fund’s significant exposure to residential as well as the logistics sector is a distinguishing feature and has added to the resilient profile of the fund. It has been offering an annual cash distribution yield of circa 4%, which is one and a half times the INREV ODCE Index in the same period. This combination has proved a winning formula during recent market turbulence driven by strong rental income.
“As we navigate the current market environment, the fund is well positioned to prove its credentials furthermore.”
The fund has a gross asset value of €1.4bn.
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