IVG holds first close for Paris fund

The German real estate fund manager has gained commitments from four institutional investors assembled in a ‘club structure’ to buy around €250m of assets.

IVG Immobilien has attracted four institutional investors to a club structure that aims to invest in around €250 million of assets in the Paris region.

The Germany-based firm, whose fund management arm is IVG Institutional Funds, said a first closing took place early this month. The club is structured as a 10-year vehicle that allows a maximum of six investors in accordance with the German Investment Act. It allows each investor to commit a minimum of €15 million.

“The great interest in our new Paris-Fund emphasizes the trend towards regional structured products with a clear focus on preferred inner-city locations”, said Bernhard Berg, managing director of IVG Institutional Funds. The new vehicle is targeting solely office and retail properties in central Paris where it hope to  benefit from rental growth.

The first property secured by the fund is a prominent retail asset with an initial yield of 5.4 percent, which was fully renovated in 2008 and 2009. The lease has a remaining term of 10 years.

Bonn-based IVG Immobilien manages around €22 billion of real estate including property held on the balance sheet. It manages €12.3 billion and €3 billion respectively of institutional funds and private funds.