Invesco Real Estate has launched its first European real estate debt fund with a plan to raise an initial €1bn.

The manager said the open-ended Invesco Commercial Mortgage Income – Europe FCP RAIF (CMI Europe) fund, which is primarily backed by insurance capital, has already completed its first deal.

CMI Europe has provided a senior loan facility to finance a pipeline of six French and three Spanish logistics facilities.

Andrew Gordon, managing director in charge of fund management at Invesco Real Estate, said the fund aims to invest in opportunities offering the best possible risk-adjusted returns available to a pan-European real estate debt vehicle.

“As a commercial actor and a relationship-based lender, this means lending across core real estate sectors such as residential, office and logistics, as well as alternatives such as self-storage, student accommodation, data centres and life sciences,” Gordon said, adding that the fund prioritises lending on sustainable assets.

Andy Rofe, managing director and head of Europe at Invesco Real Estate, said: “The launch of our first European debt fund underscores the maturity of the sector with the introduction of a pan-European, diversified open-end vehicle.

“The targeted returns for CMI Europe aim to offer a significant return premium over corporate bonds yet with a similar risk profile and stable cashflows which we believe will be able to provide high quality and predictable quarterly income streams for institutional investors.”

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