Henderson’s German retail income fund heads to market with EUR170 million to spend

By Bridging Loan Directory -

According to Property Funds World, Henderson Global Investors has raised EUR85 million for its Henderson German Retail Income Fund (HGRIF), giving it EUR170 million (including gearing) of firepower to deploy in the German retail market. It remains open to further institutional investors with an eventual target size of EUR300 million.

Current investors comprise predominantly German insurance companies and pension funds, together with an Austrian institutional investor.

The fund will focus exclusively on German retail parks, anchored by a supermarket operator. Investment criteria is for core property, dominant in its catchment area, having been recently developed or newly renovated and let to high caliber tenants. Its target income return on investment is a minimum of 6 per cent per annum with an end portfolio consisting of around ten to fifteen assets.

The fund’s first asset has already been acquired: The 8,500 sqm, fully let, retail park – Hürther Bogen – is located near to Cologne and was acquired for EUR15 million from a private investor.  Tenants include REWE, Penny, Dm-Drögerie  and Dänisches Bettenlager. Cushman & Wakefield have been appointed as property manager for this asset and the Fund. A number of further acquisitions are in the pipeline.

Thilo Wagner, Fund Manager of GRIF, says: “German retail parks offer attractive initial yields compared both to those in other countries and to other commercial sectors in Germany. Investors in the sector benefit from stable and high cash flows which allow attractive payouts. Present market conditions are optimal and we are confident that our wealth of experience within the European retail market has equipped us with the expertise to both source and add value to a diversified portfolio.”

“This fund offers German and Austrian institutional investors direct access to prime retail assets (traditionally under allocated within German institutional investor portfolios)  while simultaneously profiting from our experience and expertise.”

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