Leading German real estate fund manager Intreal reported further growth in the value and number of assets under administration in the second quarter of 2023, despite a ‘challenging’ market environment.
The Hamburg-based administration specialist said assets under administration (AuA) for third parties grew by €1.1 bn to €64.8 bn in Q2, up 1.7% compared to the first quarter and a rise of 4.4% since the end of 2022.
The number of funds administered increased by four on a net basis to 298 overall, while the net number of new properties rose by 33 to 2,570 in total.
Michael Schneider, managing director at Intreal, said the gains were achieved even though the actual growth was ‘predictably less dynamic than it had been during the previous two bumper years’.
‘Considering the persistently challenging market environment, it is a rather reassuring development. Since the AuA growth figures include new funds and properties along with the ongoing reappraisal of the total inventory, we can primarily derive two major positive signals from the latest developments,’ he said.
‘The yield adjustments triggered by the capital market rate development, on the one hand, and investors’ return expectations on the real estate buyer and seller side, on the other hand, have begun to close in on each other, at least in certain sub-segments. As a result, real estate investments have regained their appeal and prompted renewed, albeit still very cautious, capital commitments, new investment funds or transactions on the fund level.
Schneider expects this trend to continue in the coming months.
‘In the second half-year, we expect to see a continuation of the current trends, and therefore remain cautiously optimistic in regard to the business development of Intreal,’ he said.
The firm’s Luxembourg business is expected to provide further impetus in the form of new and existing fund mandates in the real estate sector but also in the infrastructure fund segment, he added.
