IVG to launch EUR 400m London recovery fund

IVG Immobilien, Germany's largest commercial property company, is launching a EUR 400 mln London Recovery fund to ride the wave of market growth predicted for the West End office market for the next years.

'We are now in the process of syndicating a London recovery fund with a size of roughly EUR 400 mln, including EUR 200 mln of equity and EUR 200 mln of debt,' CEO Gerhard Niesslein said in an interview with PropertyEU. IVG is putting between 10-15% of the equity in the fund, which will focus on office properties in the West End business district of London.

Niesslein added that the company is also setting up a green building fund to which it will transfer four of its developments in Germany. 'We are joining forces with two or three parties, each investing around EUR 40 mln of equity in the vehicle,' Niesslein explained. The Bonn-based real estate company plans to stay in the fund with a 25% interest, or an investment of EUR 40 mln, he added. The vehicle, which will have a size of EUR 300 mln, will take control of four landmark developments of IVG, including Berlin's well-leased Hackesches Quartier project in the historical centre of the city.

Niesslein said the vehicle will be the first sizeable sustainable property fund to be created in the German market. The launch of the two funds is expected to be completed in the next six to 12 months. 'We see the German cities as well positioned for recovery,' Niesslein concluded.

You can read more about IVG's plans in the Novemebr edition of PropertyEU magazine. Click here to subscribe