AXA Real Estate targets EUR 200m for Caesar Fund at second close

AXA Real Estate Investment Managers is planning to hold a second close in November this year for its Caesar Fund which is expected to reach an equity size of EUR 200 mln, Giorgio Pieralli, managing director of AXA REIM Sgr told PropertyEU.?

?The fund, targeting Italian institutional investors, raised EUR 118 mln at its first close this month. With leverage, it will have a total spending power of some EUR 400 mln, once closed.
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?'We are working with the main Italian social security agencies, pension funds as well as bank institutes and insurance companies on the launch of this new type of product which helps investors diversify their real estate portfolios,' Pieralli said, adding that the success of the fund was also partially attributable to the low dividends distributed at the moment by other sectors.?

?With a life term of nine years, Caesar will target an average annual dividend of 5.5% on invested capital and an IRR of 9%. It is AXA REIM SGR's second regulated product following the creation of Core Italian Properties Fund, which is currently fully invested. In the last three financial years, CIPF has generated an annual dividend of between 5% and 5.5% on capital invested. ?

?Caesar will target investment in core office properties in the eurozone - particularly Germany and France, as well as the UK.?

?'We will begin by investing in the UK and French office markets as we believe these currently offer the best opportunities to meet our clients' requirements by investing in assets with highly stable long-term income streams,' said Pieralli. Commenting on the outlook for the Italian property market, he added that a repricing is expected for prime offices this year. 'If we look at the gap between primary yields and treasury bonds we understand that Italian offices are not fairly priced when compared to their risk.'?