CapMan RE II, the private equity real estate fund that targets property development in Finland, has closed on €150 million ($201 million), giving it an acquisition capacity of €600 million.
The fund held its first closing at the end of September 2006 on €139 million. Altogether, 14 Finnish institutions have provided capital to the vehicle. The fund's management company, which is 80 percent owned by Nordic private equity firm CapMan, committed €2 million to the fund.
“We are pleased that fundraising and the start of investment activities by the fund have progressed according to plans,” said Markku Hietala, head of CapMan Real Estate, in a statement. According to the firm, CapMan RE II is the first private equity fund in Finland to target property developments.
The fund has so far made four investments, including properties in the cities of Hömeenlinna, Tampere and Möntsölö, all of which are in southern Finland about 200 kilometers from the capital, Helsinki. Its most recent acquisition, a 10,000-square-meter commercial and warehouse property in the Nekala district of Tampere, was almost fully leased at the time of CapMan's purchase. The firm is considering a range of assets including logistics projects as well as offices, industrial properties, hotels, residential projects and public administrative buildings.
CapMan, which is headquartered in Stockholm, raised its first real estate fund in 2005. CapMan Real Estate I, which focused on office properties in Helsinki, had an investment capacity of €500 million. Earlier this year, the fund sold almost all of its properties, 22 assets, to a consortium including Samson Properties, Royal Bank of Scotland and Ajanta Oy for €378 million. That fund has a remaining investment capacity of approximately €200 million.
Fund managers have been increasingly targeting the Nordic region. Last month, JP Morgan Asset Management announced the purchase of three office buildings in Helsinki from Neste Oil Pension Fund. In March, Protego Real Estate Investors, the European property fund management business, began marketing its core-plus Nordic Retail Fund, which is seeking €585 million in equity. And towards the end of last year, ING Real Estate, the Dutch property investment manager, closed its Nordic Property Fund, which it seeded with €560 million worth of property.
Irish bank targets Poland
Ireland's largest bank, AIB, is to raise €150 million ($203 million) for the Polish property market. The fund will pursue a diversified strategy encompassing prime quality commercial, retail, warehouse and residential assets, as well as development opportunities, joint ventures and co-investments. It will invest primarily in Poland, but will also consider other Central European countries. AIB's predecessor fund, Polonia I, invested in assets including the Warsaw Distribution Centre, the Atrium Plaza and Atrium Centrum in Warsaw, the Diamond Business Park in Lodz, and the Poznan Financial Centre.
Pension giants team up for €700m German program
Dutch and Danish pension giants ABP and ATP have combined forces with German real estate firm Patrizia Immobilien to launch a joint venture that will invest up to €700 million ($949 million) in German commercial real estate. ABP and ATP have made initial equity commitments of €60 million each. Patrizia, a publicly traded company listed on Germany's mid-cap MDax index, is investing €8 million. The company has a reputation as a specialist for privatization of residential property. It has nine offices in Germany.
Dawnay Day-backed German office fund to float on the AIM
London-based investment bank Dawnay Day is taking public a real estate company focused on providing flexible workspace for small businesses in Germany. Dawnay Day Sirius hopes to raise €300 million ($406 million) on the Alternative Investment Market. The company aims to acquire large mixed-use commercial real estate, suitable for upgrading into flexible workspace, that it can lease to local businesses across Germany. Since 1999, the company has followed a similar strategy in the UK under the name Saturn Facilities, which is a joint venture between Dawnay Day and Frank and Kevin Oppenheim. In 2005, the partners branched into Germany under the name Sirius Facilities Group. The company is seeding the portfolio with 20 properties from Sirius worth €206 million.
Norway pension scheme looks set to wade into property
The $300 billion (€230 million) Norwegian Government Pension Fund is proposing to start investing in real estate. Proposals put before the finance ministry are for the world's largest pension fund to invest also in hedge funds, infrastructure, private equity and to increase its equities allocation from 40 to 60 percent. The Norwegian Government Pension Fund was set up by Norway to invest its huge oil revenues from the North Sea.