AXA Immoresidential converts to Spezialfonds status

AXA Real Estate Investment Managers said on Monday that the AXA Immoresidential real estate fund has converted from a public mutual fund to a German special fund. This is the first ever successful conversion of a German public mutual real estate fund into a Spezialfonds dedicated to institutional investors in Germany.

AXA Immoresidential was launched in 2009 as a German public mutual fund specialised in residential real estate investment in Germany and was already structured as an investment vehicle for institutional clients only. Since the launch of the fund, the German legal framework for public mutual funds has changed significantly, resulting in the main target clients, German insurance companies, no longer being allowed to allocate new investments in the fund from their statutory reserve capital.

By undertaking a conversion to a Spezialfonds and through the adjustment of the fund’s rules, AXA Immoresidential will remain 'eligible' for its target clients and, at the same time, provide a platform for further growth, AXA Real Estate said. A decisive issue in the fund’s conversion was the proposed change of rules for unit redemptions, which has been designed to fit with German insurance companies and pension trusts recent requirements.

All existing clients have committed to the conversion of AXA Immoresidential. In addition, the new structure has already attracted its first new client, a German bank, which has undertaken a EUR 10 mln subscription.

The fund's investments at the end of February 2012 totalled EUR 120 mln and AXA Immoresidential is targeting a total fund investment of EUR 500 mln by the end of 2013.