Spanish firm makes splash with real estate fund

Private equity firm GED and financial group Caja Madrid have teamed up to establish a real estate investment fund targeting Southeastern Europe.

Spain is trying to make its mark. Spanish private equity firm GED and Spanish bank Caja Madrid today launched GED Real Estate Eastern Investments with initial capital of €25 million ($34 million). The investment vehicle will have a lifespan of ten years and will invest in 10 to 15 projects, each between €5 million and €15 million.

The fund’s focus will be on Romania but it is also looking to invest in Bulgaria and other neighboring countries.

The real estate market in Romania has been bolstered by economic and legal changes taking place in the country. Early this year it became a member of the European Union.
“The Romanian real estate market offers great investment opportunities due to its big dynamism and growth potential,” Enrique Centelles, GED president, said in a statement.

The subscription period for the fund will be six months with the option of extending it an additional six months. It hopes to raise between €100 million and €150 million, drawing from both institutional and private investors, with a minimum commitment of €3 million per investor.

The investment team, made up of five professionals, will be working from offices in Bucharest. The team is currently looking at ten investment projects and is expected to invest in one or two projects this year.

GED currently manages more than €300 million through several vehicles including GED Eastern Fund II, GED Iberian Fund I, GED Sur and GED Real Estate Investments. The group invests mainly in Southeastern Europe and the Iberian peninsula.