GERMANY - The successful launch of a €630m fund and a new report revealing greater inflows from foreign investors show the real estate Spezialfonds sector is continuing to grow, despite economic and regulatory uncertainty.
Real estate Spezialfonds had net inflows of €2.6bn in 2011, bringing total assets in the vehicles to €32.7bn, and the number of companies authorised to launch Spezialfonds is expected to rise to more than 34 this year, according to the study.
The report, produced by investment association BVI and Till Entzian of Veritas Investment Trust, also showed a significant increase in foreign capital flowing into real estate Spezialfonds, almost doubling from €1.3bn in 2010 to €3.3bn in 2011.
Soon after the findings were released, Berlin-based real estate Spezialfonds manager Beos announced it had raised €365m in equity from 19 German institutional investors for its latest fund.
Beos had more than doubled its capital raising target of €100m and board member Stephan Bone-Winkel said there was enough interest from other investors to raise further capital in the future or to launch a successor fund.
Bone-Winkel said: "We did not want to be pressured in selecting objects and want to continue to make only very selective purchases."
With leverage, Beos Corporate Real Estate Fund Germany II will have €630m in capital to deploy and the manager aims to acquire €200m of commercial real estate in Cologne, Frankfurt and Hamburg over the next four weeks.
The fund's predecessor, launched in August 2010 with €230m of equity from 11 institutional investors, will be fully invested by the end of the year.
Beos will be on of at least 34 KAGs (companies authorised to issue Spezialfonds) in the market by the end of the year according to Entzian's report, formerly known as the Kandlbinder report, based on data from Spezialfonds registered with the BVI.
In 2011 alone, four new players were authorised to offer real estate Spezialfonds. Art-Invest Real Estate Funds' application for license is currently being assessed and Internos Real Investors KAG was granted permission by German supervisor BaFin this year and has since launched a Spezialfonds focusing on hotel investments.
According to Entzian, some estimates suggest up to 40 KAGs could be authorised before the end of 2012.