Germans help boost Henderson property fund assets by €90m

Germans seem to believe in their countrymen’s ability and willingness to keep spending, as they have helped boost assets in a Henderson property fund focused on German retail warehouses by €90m.

After the most recent raising of €90m, plus gearing, Henderson’s product has total funds of €350m, including spare cash to commit to its one focus of German retail warehouses anchored by supermarkets.

It has been capped for a second time.

It has 12 investors, which Henderson says are predominantly insurance companies and occupational pension funds in Germany.

Since the fund’s first close in summer it has spent €60m on four buildings in Forcheim, Köln-Hürth, Ulm-Nersingen and one near Dusseldorf. It hopes to end with 12 to 15 assets providing in aggregate at least 6% annual returns.

European real estate managers, Henderson included, note Europe is not a single market in terms of investment opportunities, even if overall returns from the region’s property are expected by some managers to fall by 2.6% this year.

Research from DekaBank late last year showed four of the five most attractive areas for office property investment in Europe are in Germany, with only Lyon in France better than Stuttgart, Hamburg, Cologne and Berlin.

German retail has also held up, along with the German consumer last year.

Thilo Wagner (pictured), fund manager of Henderson German Real Estate Investment fund, said: “German retail warehouses were a star performer throughout 2011. They continue to offer attractive initial yields compared both to those in other countries and to other commercial sectors in Germany.

“The initial four acquisitions are testament to our wealth of experience and expertise within the European retail market, which have enabled us to source a suitable and diversified portfolio.”

Tim Horrocks, head of distribution for Henderson Property said: “This additional fund raising concludes a successful year for the property business with a total capital raising of €1bn throughout the year. We look forward to the year ahead which we enter in a strong position as we look to deploy our capital”.

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