GERMANY – The range of investment returns from real estate Spezialfonds has never been wider according to the latest research from index provider IPD.
According to the SFIX, an index of Spezialfonds produced by IPD in conjunction with asset management association BVI, returns in 2013 ranged between -12% and 8% with a median of 3%.
Daniel Piazolo, managing director at IPD, attributed the findings to diversification and specialisation in the market. "There is a continued trend away from major funds towards niche products," he said at the presentation of the index study in Frankfurt.
The index, which tracks the performance of 145 Spezialfonds with combined assets of €33.8bn, also showed a much more pronounced spread between funds solely investing in Germany (0.9% for the quarter) and those investing in all of Europe (-0.5%).
This spread of 140bps is a "new record high" but a continuation of an outperformance that has been apparent for some time, IPD noted.
Over the past five years, the annualised return of funds focusing on Germany at 3.3% is well above that of European funds at 0.8%.
Commenting on the results, Eitel Coridaß, CIO at Warburg-Henderson, said: "We have to take into account the observation period starting in 2007, which means most of the investments have been made during the crisis when Germany was considered a safe haven, before the crisis this was not always the case."
Coridaß also noted that some of the underperformance in certain European regions presented "an entry opportunity".
Sebastian Gläsner, head of fund services at IPD, pointed out that one-third of the Spezialfonds in the index were currently in the selling phase and this would influence prices and performance.
Real estate company Hahn Group announced it would issue its first Spezialfonds this year "geared to a small group of professional investors".
For this purpose a capital management company (KVG) was set up in September under the new investment law, KAGB, with which Germany implemented the Alternative Investment Fund Manager (AIFM) directive.
The company is still to be accredited by the German regulator Bafin and is planning to issue the first public fund in compliance with the KAGB in "the first half of next year", the fund noted in an interim report.