EUROPE – Schroder Property has raised €225m from Swiss institutions in the first close of a real estate fund targeting assets in core European countries.

The Schroder Core European Property fund was specifically designed for Swiss investors, the manager said, leading to a partnership with Zurich Investment Foundation, part of the asset management division of Zurich insurance group.

The fund itself is only open to Swiss investors, and funding largely came from the country's pension funds, a spokeswoman for Schroders confirmed.  

While Swiss pension funds usually have a sizeable exposure to real estate, their investments are often domestic.

Schroders said it expected to double the size of assets by the time it announced the fund's second close later this year, initially aiming to acquire property in France and Germany and expanding to other core countries in due course.

The new partnership with Zurich will be managed by Tony Smedley, who joined the company as head of pan-European fund management from Invista Real Estate Investment Management in July last year.

Schroders head of property funds Duncan Owen said the close marked a "very positive step" towards developing the business across Continental Europe.

The euro-denominated vehicle will aim to return 5% per annum.