Warburg-HIH Invest Real Estate, a Hamburg-based fund manager owned jointly by HIH Real Estate and private bank M.M. Warburg, delivered an 8% return to investors in 2017 and raised managed assets by 11% to €6.7bn over the year.
Hans-Joachim Lehmann, managing director of Warburg-HIH Invest, which runs vehicles meeting the EU's Alternative Investment Fund regulations, said the firm, "owed the robust result to a series of successful project acquisitions in Germany and other European countries, as well to our ability to find bespoke investment solutions." The result was also reflected in a strong performance. "Delivering a total return of around 8%, we achieved another impressive result for our investors while rolling back the leverage."
Alexander Eggert, MD and head of fund and product management, added in a release: "Our strategic long-term investment strategies are paying off." Transaction volume last year reached €1.6bn, split between €1.1bn in 26 acquisitions - unaltered from 2016 volume - and some €500m in 21 disposals - down slightly from €0.8bn in 2016. Though total transactions were beloe 2016's €1.9bn, the group was pleased with last year's volumes, achieved in a strained market defined by pent-up demand.
"As in previous years, we were able to realise substantial volumes in off-market deals," Lehmann said. "We managed to buy into many core properties in a very early development stage and thereby secure comparatively favourable initial cost conditions."
Assets acquired in Germany last year included the Quartier am Auswärtigen Amt complex in Berlin, the urban view development in Heidelberg, the Oberwiehre shopping centre in Freiburg, Bremer Carrée retail in Bremen, and the Sagittarius Business House and Pegaz schemes in the Polish city of Wroclaw. Sales were dominated by strategic disposals of single assets such as the Kö-Blick mixed office-commercial building in Düsseldorf, and the Arts20 office scheme in Brussels, as well as retail in Italy, Spain and Austria. In all, Warburg-HIH Invest was active in seven other European countries last year, transacting €312m. It established new branch offices in Vienna and in Amsterdam to add to those in Paris and Madrid.
Felix Gold, MD for capital management and structuring, said 2018 should bring a steady increase in investor interest coupled with a trend toward single mandates and single investments, supplemented by a constant need for portfolio diversification and pooled fund solutions. The latter trend is driven mainly by savings banks and cooperative banks, he added.