Germany’s Real IS has started fundraising for a EUR 500 mln fund, BGV IV, which will invest in eurozone countries. The company is looking to raise equity of up to EUR 350 mln for the fund, with the first closing expected by the end of 2009. This is the first vehicle by Real IS to invest exclusively in euro-denominated countries.
Germany’s Real IS has started fundraising for a EUR 500 mln fund, BGV IV, which will invest in eurozone countries. The company is looking to raise equity of up to EUR 350 mln for the fund, with the first closing expected by the end of 2009. This is the first vehicle by Real IS to invest exclusively in euro-denominated countries.
‘At the moment investors don’t want to have any currency exchange risk,’ explains Jochen Schenk, a member of the management board, during the EXPO REAL real estate fair in Munich. ‘We can launch this type of fund now because of the low pricing level in most European countries,’ he adds.
BGV IV is a German spezialfonds which will target office, logistics and retail properties in Germany, France, the Netherlands, Luxembourg, Belgium and Austria. The fund, with a life of 10-12 years, is targeting a payout of 6% per annum.
Schenk said that the company is also seeking to raise up to EUR 300 mln for a new German retail fund, which will target a payout of 5.75 - 6.25% per annum, after taxes. Real IS, which manages funds for retail and institutional investors, has raised EUR 400 mln of equity in 2009 for a number of vehicles. While retail investors accounted for most inflows (around 75%), Schenk said he expects institutional investors to come back to the market in the next few months.
‘We are experiencing new interest in our funds from institutional investors and we expect to see a very high level of inflows in the next 12 months as institutional investors come back to real estate,’ Schenk said.
Recently, Real IS completed the fundraising for its BGV III fund, which raised EUR 370 mln of equity. With leverage, the SICAV FIS fund has the firepower to invest up to EUR 700 mln in Europe and abroad.
Although all the equity came from German investors, Schenk said that the company is also planning to go to the international market for the next fundraisings. ‘We are very intensively thinking about working with some international investors and we would like to start looking for funding in the Netherlands in the next couple of months, and then in the UK.’
The company has completed over EUR 400 mln worth of deals in the past 12 months. Last week, the company acquired a property in Clichy for EUR 52.5 mln.
