UK-based retail property fund and asset manager Pradera is on a drive to broaden the investment remit of its number one ranked Pradera Open-Ended Retail Fund (POERF) in order to home in on attractive opportunities in Italy and Spain, Simon Cairns, the fund director, told ProperyEU.
UK-based retail property fund and asset manager Pradera is on a drive to broaden the investment remit of its number one ranked Pradera Open-Ended Retail Fund (POERF) in order to home in on attractive opportunities in Italy and Spain, Simon Cairns, the fund director, told ProperyEU.
‘Currently, around 50% of this €200 mln fund is invested in the UK, with the rest invested in Germany and Poland. However, going forward, we’d like to broaden this to Italy and Spain where we now see some exciting buying opportunities,’ Cairns said. ‘Within POERF, we are planning to invest €200 mln this year in individual volumes of between €20 mln and €60 mln and already have several deals in due diligence,’ he added.
At end-March, it emerged that POERF was ranked the best performing fund for 2014 on the BVI/IPD Spezialfonds Index (SFIX Europe). The German index is based on a sample of 65 funds with a total net asset value of €20 bn as of end-December 2014. Over a five-year period, POERF was ranked fourth out of 47 funds.
The 65 SFIX Europe funds are European mandates, meaning they have less than 70% of their assets in Germany or in any other single county. Within this group, there are also funds managed by AXA and DEGI. Although there are 65 funds in the sub index SFIX Europe, there are 162 SFIX funds in total, including 78 in SFIX Germany, with those funds at least 70% invested in Germany.
Pradera’s Spezialfonds has a target annual return of between 7% and 10%, and an income return of about 6%, according to Cairns. ‘To achieve these returns, we are targeting those properties we feel are beneficiaries of current retail trends and where we can apply our asset management expertise, such as retail parks where multi-channel retailers are looking to relocate and concentrate their stores for ‘click and collect’ operations,’ Cairns explained.
POERF is focused on the retail property sector in Europe and was launched as a German mutual fund in December 2009 before being restructured into a German institutional Spezialfonds in April 2013 in response to changing legislation. As such, it is similar to Pradera’s three Luxembourg-based retail funds, albeit designed for German investors who have a preference for German domiciled vehicles. The fund invests in both shopping centres and retail parks.
In March, Pradera announced that it had agreed a deal that will see it remain an independent investment manager. Co-founder Colin Campbell, who already owned 40% of Pradera’s holding company, Kuno, purchased business partner Paul Whight’s 60% stake for an undisclosed sum. The sale allows the business to retain the Pradera name and independent management following speculation in 2014 of a sale to a third party.
Founded in 1999, Pradera manages 60 retail properties in eight countries accommodating more than 2,000 tenants. The total portfolio has a combined value in excess of €2.4 bn.