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M7 closes largest fund to date at €125m

The real estate investment and asset manager closes third value-add European vehicle and announces it will have a total of €300 million to deploy. 

 

M7 Real Estate, the London-based real estate investment and asset manager, has held a final close of its third European investment fund, European Real Estate Investment Partners (EREIP) III on €125 million.

The firm, which held a first close for the fund in March on €80 million, has said it will have a total spending capacity of €300m. Through EREIP III, M7 has now purchased €204 million worth of assets with an average yield of 10.7 percent.

In addition to the final close, the firm has also acquired a portfolio of seven Dutch industrial assets for €34.6 million, reflecting a net initial yield of 9.74 percent. The 750,374 square foot portfolio, known as the Zenith Industrial Portfolio, was acquired from a joint venture managed by Goldman Sachs and Valad Europe.

The portfolio currently produces €3.7 million of rental income per annum and has existing tenants including Post NL, watchmaker Seiko, the German car parts manufacturer ZF Group, Impco-Beru Technologies and TNT.

The acquisition brings EREIP III’s total portfolio to approximately 3.8 million square feet, across 45 assets. The vehicle, which has a further €70 million of assets under offer, has been raised to buy assets that offer sustainable income streams and as well as asset management opportunities in the retail, office and industrial sectors in Germany and the Netherlands.

Richard Croft, M7’s chief executive said: “M7 EREIP III is M7’s largest fund to date, raising funds from third party US and Asian investors totaling €125 million. We are very pleased with the Dutch and German assets that have been acquired which provide a strong mix of core income coupled with opportunities to drive value through refurbishments and rental growth.”

In April, the firm announced that it had deployed all the capital from its first European fund, EREIP I, for which it raised €90 million. M7, which launched the vehicle last year, acquired 23 properties for EREIP I including a €43 million retail portfolio in Germany.

M7’s second fund, EREIP II, closed in October last year. The firm raised €40 million on behalf of the fund and acquisitions include three Dutch value-add mixed-use commercial properties.