HIH Invest Real Estate GmbH, in partnership with German housing company Vonovia, has launched a second investment fund focused on residential real estate.
Similar to their initial joint fund launched in September 2024, HIH Invest holds a majority stake through a regulated AIF on behalf of institutional investors. Vonovia will manage the properties, while HIH Invest will oversee asset and fund management.
The fund has already acquired ten properties totaling €516 mln in investment volume. This includes eight development and new-build properties, along with two existing properties undergoing modernization. The properties, acquired from Vonovia subsidiaries GSW and Buwog, comprise 127,000 m2 of total space, including 97,600 m2 of residential space and 8,700 m2 of commercial space. The portfolio also includes 928 parking spots and approximately 1,700 residential units, primarily two and three-bedroom apartments, alongside student and serviced apartments.
The properties are located in Berlin (3), Stuttgart (2), Hamburg, Leipzig, Dresden, Munich, and Falkensee near Berlin.
Felix Meyen, managing director at HIH Invest, said: ‘Once again, we seized an opportunity to buy into an attractive, energy-efficient portfolio of residential assets located in German metropolises and fast-growth cities. The buildings have been, or will be, constructed to meet the KfW-55 or the KfW-55 EE sustainability standard, while the two revitalised buildings underwent comprehensive energy refurbishments. Two properties are seeking a DGNB “Gold” sustainability rating.’
Carsten Demmler, managing director of HIH Invest, commented: ‘Despite the challenging environment, we managed to present another outperforming product to our investors. We were able to gather a club of seven institutional German investors. It is an auspicious time to invest in Germany’s rental housing market because selling prices have just bottomed out. With demand for accommodation exceeding supply, rent revenues harbour further upside potential.’
Alexander Eggert, managing director of HIH Invest, added: ‘Just recently, we launched a joint fund with Vonovia, which acquired a total of 14 property developments and new-build structures that have a combined investment volume of more than €630 mln. We have come to know Vonovia as a reliable and very professional partner with whom we managed to develop a highly attractive investment opportunity with an outstanding risk-return ratio.’
Most underground car parks are equipped for electric vehicles, including charging stations. The residential buildings are found in established districts, offering high quality of life with easy access to public transportation, shopping, schools, and medical services, all within walking distance.
The newly launched fund adheres to Article 8 of the EU Sustainable Finance Disclosure Regulation. A consortium of institutional investors has committed the necessary equity capital. Vonovia offers an initial guaranteed letting service for both residential and commercial units within the portfolio.
The Hogan Lovells law firm provided legal and tax advisory, while the technical and the ESG pre-acquisition audits were performed by Drees & Sommer.
