Global specialist real estate investor Round Hill Capital has acquired a portfolio of three newly built, build-to-rent freehold assets in Aarhus, Denmark, from three investment vehicles established and managed by Pareto Securities.
Financial details were not disclosed.
The purchase was made on behalf of Round Hill Capital’s European residential income fund II (ERIF II), which also owns around 1,700 residential units across Germany, Ireland, the Netherlands and Finland.
Michael Bickford, founder and CEO of Round Hill Capital commented: 'High quality, modern residential assets with good environmental credentials, located in leading European cities with strong supply / demand fundamentals, remain a conviction asset class for Round Hill Capital.
'Securing these assets off market at a pricing level that we consider extremely attractive in the current market, demonstrates our ability to source opportunities with strong income characteristics, while at the same time acting as a dependable buyer providing transaction certainty despite the challenging economic environment.'
The portfolio comprises 324 units, with a mix of one, two and three beds, across more than 21,000 m2, and is expected to appeal to a broad range of demographic groups from students and young professionals through to families and seniors.
Two of the buildings, totalling 276 units, are located in Tilst, whilst the third, comprising 48 units, is located in Risskov.
Both micro-locations are located close to multiple educational institutions and the Aarhus University Hospital, which is the largest workplace in Aarhus with over 10,000 employees. Nectar Asset Management will act as the property manager and LokalBolig as the leasing agent.
The assets are being acquired with a high occupancy rate. In addition, as part of the transaction, Round Hill Capital has arranged for ERIF II to take over the attractive existing financing in place on the portfolio.
With a population of 355,000, Aarhus is Denmark’s second largest city. It is characterised by strong population growth which, with an over 8% increase forecast over the next 10 years, is driving demand for new residential accommodation.
Frederik Kock, equity partner and responsible for Pareto Securities’ Danish activities, added: 'We are very pleased to execute this transaction with Round Hill Capital despite the challenging market conditions and the significant interest rate hikes during 2023.
'The divestment has secured our investors a satisfactory exit and underlines the strength of our focus on high-quality, modern residentials assets in areas with strong underlying demographic trends.'
Anders Holm, partner, Colliers: 'The transaction confirms an ongoing trend, where we see strong, professional, and foreign investors focusing on the major growth areas outside of Copenhagen. In this case, an investor who entered the Danish market with a transaction in Aarhus.'
ERIF II is a Core / Core Plus commingled investment fund targeting multifamily housing assets in strong micro locations that exhibit positive demographic and macroeconomic trends, persisting supply/demand imbalances and strong transport links.
The fund targets income producing, well-let, multifamily properties in European markets that exhibit strong macro-economic growth characteristics.
CBRE, Kromann Reumert, Deloitte and COWI acted on behalf of Round Hill Capital, while Colliers, Bech Bruun, Grant Thornton and Emcon acted on behalf of the seller.
