Union Investment has created the largest open-ended residential fund in Germany, raising €620m from investors.
UniImmo Wohnen ZBI is Union Investment’s first residential fund, which it launched earlier this year by teaming up with sector-specialist ZBI Zentral Boden Immobilien.
Union Investment said it had raised the capital during “its first subscription phase”, implying it would continue to grow the fund.
ZBI has already secured €460m in assets, more than half of which have been transferred to the fund. Union said the “remaining sub-portfolios” would be transferred in August and September.
Union said the assets were sold by a group of UK and US investors.
One porfolio that has been transferred includes 260 properties with approximately 2,500 residential units and is valued at €132m. The assets are located mainly in the west German cities of Düsseldorf and Gelsenkirchen, and includes exposure to others states including Saxony.
About 70% of another portfolio with a pro-rata value of approximately €113m has also been transferred to the fund.
The portfolio is mainly located in North Rhine-Westphalia, primarily in the cities of Bochum, Essen, Duisburg and Düsseldorf.
It comprises 150 properties with around 2,500 residential and commercial units.
Union and ZBI will invest in the porfolio to bring the assets to full occupancy and increase their value.
Reinhard Kutscher, chairman of the management board of Union Investment Real Estate, said: “We are delighted to have got off to such a good start, both on the marketing side and with regard to acquisitions.
“With its initial portfolio, the fund is very well positioned to leverage opportunities in the German residential real estate markets.”
Union said Unilmmo Wohnen ZBI focuses on properties throughout Germany that “offer affordable living space for the wider population, with medium to high amenity value”.