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Aberdeen Standard Investments launches European property fund

Aberdeen Standard Investments (ASI) has launched a European Residential Property Fund, designed to focus on the low supply and high demand for rented residential property across Europe.


Sonia Rach

Deemed as the first of its kind, the open-ended property fund will invest in the residential sector on a pan-European basis, focusing mainly on the ‘private rented sector’ (PRS).

However, while PRS will be a majority, 25% of the total portfolio can still be invested in other types of accommodation such as student housing, retirement and nursing homes.

The investment strategy will be to purchase existing private rental housing blocks and forward-fund the development of new properties to create a portfolio of good quality, sustainable middle-income residential properties.

Supported by investor Pensioenfonds Metaal en Techniek (PMT) and its fiduciary manager, MN, the property fund has already raised £350m from eight investors in the Netherlands, Switzerland, and Luxembourg.

ASI said up to half of the total capital will be deployed in Germany, with the remainder invested across cities in western Europe, including the UK.

The fund will be managed by Germany-based Marc Pamin and supported by assistant fund managers Ed Crockett (UK) and Ole Tange (Denmark).

The managers will also be supported by a wider team who have been investing in residential property since 1999 and have €5.2bn invested or under construction in Europe.

Additionally, the fund has a target return of 5% to 7% net of fees, with an income element of 3% to 4% per year. Debt will also not exceed 40% at a fund level and will have a long-term target leverage of 25%, the firm confirmed.

ASI added it has further fund-raising planned and intends to grow to above €1bn over the next five years.