Union Investment, manager of three large German open-ended real estate funds for retail investors, is chasing more single-investor mandates from institutional investors in 2012. In the last six months, the fund manager received binding capital commitments of EUR 900 mln for three new spezialfonds, which are exclusively for institutional investors. The equity commitments will be drawn and invested in the next 2-3 years.
Union Investment, manager of three large German open-ended real estate funds for retail investors, is chasing more single-investor mandates from institutional investors in 2012. In the last six months, the fund manager received binding capital commitments of EUR 900 mln for three new spezialfonds, which are exclusively for institutional investors. The equity commitments will be drawn and invested in the next 2-3 years.
Union Investment raised EUR 300 mln for UII No.1, its European shopping centre fund which it actively manages and has already acquired two malls in Germany. Some EUR 250 mln was raised for a residential property fund, Residential Value on behalf of a single investor with its own asset manager to invest in high-end apartments in Berlin. Union Investment was contracted to create the spezialfonds vehicle through its KAG fund unit, but will not act as asset manage for the vehicle which invests in residential property which is not part of Union’s focus.
A further EUR 350 mln in commitments were raised for a third vehicle established in mid-December to invest in office, retail and hotel assets in selected European markets on behalf of a single client. This type of mandate is new for Union. ‘There is new demand in the market for a product that splits the company between the KAG, which manages the vehicle, and the asset manager,’ chairman Reinhard Kutscher said. ‘It is part of our strategy to grow this side of the business in 2012 and win some of the mandates we are pitching for.’ Kutscher also expects to launch new actively managed products for institutional investors, akin to its shopping centre fund. The new business will include thematic funds and pooled vehicles, according to board member Christoph Schumacher.
The company’s open-ended fund business - comprising UniImmo Deutschland, Europa and Global - saw net inflows of EUR 650 mln and carried out 17 acquisitions totalling EUR 1.3 bn last year. Eighteen properties were sold for a total of EUR 700 mln as part of normal asset management activities, Kutscher said.
