Catella, Bank Sarasin launch sustainable RE fund

The fund, Sarasin Sustainable Properties – European Cities, is targeting mainly Swiss pension funds, and is said to be the first real estate vehicle for institutional investors to invest solely in sustainable buildings in high-growth European cities.

Catella Real Estate and private Swiss bank, Bank Sarasin, are launching a sustainable real estate fund mainly with Swiss pension fund investors in mind.

Catella, which manages more than €1 billion of real estate funds, said the offering would be called Sarasin Sustainable Properties – European Cities.

It said it was the first real estate fund for institutional investors to invest solely in sustainable buildings in high-growth European cities.

In a statement today, the joint venture partners said: “Against a backdrop of rising energy prices and stricter energy consumption regulations, a building’s energy efficiency is a key factor in its capital appreciation. In addition, the current financial crisis shows how important a careful review of the macroeconomic and political environment is. The cities in which the new fund will invest will be selected not only on the property market cycle, but also on their long-term socio-economic attractiveness.”

The newly launched real estate fund will initially focus on Germany, France and the Nordic region. It will primarily invest in office and commercial properties. Up to 25 per cent of the fund may be invested in residential buildings. The pair added that initially they would buy only existing buildings, with development projects added in the future.

It is looking to return 5 to 5.5 percent to investors.

The fund offering is directed primarily at Swiss pension funds via a German special fund vehicle.