AEW targeting €700m for “manage-to-core” fund

Pan-European real estate manager AEW Europe has brought German and Austrian institutional investors into the first close of its latest European real estate fund, a so-called “Manage-to-Core” fund.

Six investors have committed €101m to the AEW Europe Value Investors Fund, which will focus on core-plus and value-add office investments. AEW said the fund, which is targeting a total investment capacity of €700m, expects to have two further closings this year. The fund will focus on office markets in Germany, France and the UK.

“Current market pricing provides the opportunity to acquire office assets at discounted values and at an attractive point in the cycle. The fund will benefit from the capabilities of our European platform of local and experienced teams specialising in value add investments,” said head of private equity funds Russell Jewell.

Carsten Czarnetzki, fund manager for Europe Value Investors, said the fund would invest in office assets that can be managed or repositioned into core assets. “The fund’s strategy is to take advantage of the strong demand for stabilised core assets, targeting the most liquid European markets,” Czarnetzki said.

AEW Europe has launched a number of private equity real estate funds since 2001 and currently manages more than €18bn in Europe in a number of funds and separate accounts. AEW Europe is part of the French Natixis group and has more than €18bn of assets under management, with nine offices and over 270 staff.

The group recently bought a new logistics asset in a multimodal logistics park in Bremen’s harbour, scheduled for completion in December this year and fully-let to a top logistics provider on a 10-year lease. AEW said the new asset would further its plans of growing its Logistis platform in northern Europe, and said it plans further investment in Germany of up to €500m over the next two years.

"We are currently targeting further German acquisitions already identified by our local teams. We will continue to build a high quality portfolio that provides a relatively high stable income return to our investors as part of the next phase of expanding the Logistis brand in northern Europe," said fund manager Rémy Vertupier. Logistis has a significant acquisition pipeline in Germany, Benelux and France, AEW says.