Union Investment achieved strong growth in its institutional real estate business in the year now ending. Compared to 2016, institutional investment assets in actively managed funds, Service KVG mandates and pooling vehicles rose by a total of 15 per cent (as at 30 November 2017). With funds under management of approximately EUR 9.1 billion (prior year: EUR 7.9 billion), Union Investment confirmed its leading position as a provider of institutional real estate solutions.
Union Investment was particularly successful on the Service KVG mandate front. By gaining new mandates and extending existing ones, between January and November 2017 investment assets in this area grew by some 19 per cent to a total of EUR 3.4 billion. Over the course of the year, Union Investment was also able to acquire capital commitments of EUR 1.4 billion, exceeding the prior-year figure by approximately 38 per cent.
The launch of new thematic fund products such as Urban Living Nr. 1 also contributed to the positive results. The acquisition focus of this open-ended special AIF fund is on micro apartment complexes which appeal to young professionals, students and one-person households. The fund invests primarily in dynamic German cities and metropolitan areas. In 2017, Union Investment also extended its special AIF offering in the residential segment with Deutsche Asset One as its partner.
The real estate portfolios of the institutional retail and special funds underwent targeted development through a total of 11 transactions. Alongside five acquisitions totalling EUR 185 million, six sales worth EUR 40 million were made in the first eleven months of the year. Additional investments for the institutional funds are close to completion.
The institutional part of Union Investment’s business is set for further growth in 2018: “We are experiencing strong investment interest across all pillars of our institutional real estate business. We will see further growth over the next few months both from existing funds and by extending the product range,” said Jörn Stobbe, a member of the management team at Union Investment Institutional Property GmbH.
Source : Company