Allianz and Asian investor pump €600m into Dutch resi platform

Allianz Real Estate and an unnamed Asian investor are accessing the booming Dutch residential property market by pumping €600 mln into local institutional platform Vesteda.

Vesteda owns 23,000 residential units, valued at €3.7 bn, in the Netherlands. All its current investors are Dutch institutions.

The first foreign equity infusion into Vesteda from Allianz Real Estate and the Asian institutional investor includes €354 mln earmarked for acquisitions, allowing the company to compete more effectively in the Dutch residential investment market with the increasing number of internationally backed platforms, such as Round Hill and Patrizia Immobilien, which have entered the arena in the last 12-18 months.

Some €160 mln of the €345 mln war chest will be used immediately. An additional €255 mln – bringing the total investment to €600 mln - will be used to meet redemption requests of existing participants in Vesteda.

The overall transaction is one of the most significant foreign investments in Dutch residential real estate in recent years.

Vesteda’s key investment regions are the Randstad urban conurbation and Noord Brabant province. In 2014 Vesteda generated a net result of €136 mln, with more than 200 employees.

Vesteda's management board consists of CEO Gertjan van der Baan and CFO Hélène Pragt, both appointed last year. They say the new investment by 'global leading parties' is a confirmation of Vesteda being the platform of choice for institutional investors with a long-term horizon that would like to benefit from the opportunities in the Dutch housing market. Vesteda focuses in particular on the mid-rental segment in economically strong regions in the Netherlands.

Van der Baan: 'We are proud that our strategic direction is endorsed by two leading international investors. We have recently strengthened our internal property management organisation, improved our financing structure and obtained an S&P BBB corporate credit rating. Moreover, we expanded our acquisition team to pursue our growth ambition in both existing and new properties. These building blocks contribute to further growth of our portfolio and profitability. The transaction marks yet another significant step in realising our ambition.'

Kempen & Co acted as financial advisor, Allen & Overy LLP as legal advisor and PwC as tax advisor for the investment by Allianz Real Estate and the Asian investor.