Patrizia Immobilien, the Augsburg, Germany-based real estate investment manager, is looking to raise €250 million to €300 million for a Japanese residential fund, which including leverage would have a total firepower of €480 million to €550 million.
The firm has partnered with Tokyo-based real estate investment firm Kenzo Capital Corporation to raise capital exclusively from German institutions. Kenzo will act as the asset manager of the vehicle.
The pair will look to invest in the major metropolitan areas of Japan, mainly in Greater Tokyo and Greater Osaka, as well as in Nagoya and Fukuoka, targeting modern residential properties with a core-plus strategy.
The pair are targeting an average annual distribution of 5 percent and internal rates of return of 8 percent, after holding the properties for approximately 7 years.
“It builds on our team’s knowledge and experience and further strengthens Patrizia‘s position in a market which is increasingly attractive to investors due to Japan’s strong economic growth and its stable political situation,” commented Sven-Olaf Eggers, managing director Patrizia.
The pair have already made their first investments, four apartment buildings in Japan for around €30 million, after garnering more than €45 million from a Frankfurt investment management and consulting firm, and a pension fund.
The fund launch for Patrizia, which manages over €18 billion of real estate assets, comes at busy time for the firm. Since the start of the year the firm has made senior appointments across its US, Europe and Australia offices and has secured major investments for a growing number of international investors, such as the acquisition of Germany’s tallest building, the Commerzbank Tower, for €800 million, on behalf of an Asian investor.