Le mie ricette per la real estate communityDeutsche Investment just set up “Deutsche Investment – Büro II,” its second office real estate fund for institutional investors. The corresponding license by the German Supervisory Authority for Financial Services (BaFin) has already been issued. The investments of the new real estate special AIF will focus exclusively on cities in Germany, the plan being to invest about one half of the capital in Class A cities (the “Big Seven”) and the other half in metro regions and selected fast-growth cities. The target investment volume amounts to a total of EUR 300 million, which is supposed to be achieved within an investment period of around 24 months.
The process of building up the portfolio of office properties held by the fund seeks to ensure that its rent revenues will be generated to at least 70% from office units. The objective is a broadly diversified portfolio with asset lot sizes between EUR 5 and 50 million and qualities that include a high alternative use potential and predominantly multi-tenant structures. In addition, at least 70% of the real estate to be acquired should belong in either of the two risk classes Core and Core+, whereas properties of the Value-Add category should account for no more than 30%.
The minimum subscription amount is EUR 10 million. The fund will target an overall term of ten to twelve years, a net cash-on-cash return of about 4.0 % to 4.5 % p.a., and a projected total return target (IRR) of no less than 4.5 % when taking debt into account. The entire fund, asset, transactions, property and facility management will be provided by Deutsche Investment, true to the principle of full vertical integration.
Source : Company