Apeiron-Kauri joint venture targeting €1bn in Berlin residential

London-based Apeiron Capital and its German partner, Kauri CAB Management, along with an unnamed sovereign wealth fund, are targeting investment of up to €1bn in Berlin's residential sector. The announcement comes after the partnership has just bought around 900 apartment in three residential portfolios in the city for about €100m.

We reported on the formation of the joint venture in thes pages in December 2014, which the partners now say has brought the joint venture closer to its initial target portfolio size of €300m. The JV kicked off by paying €130m to buy the 120,000 sqm Zeus portfolio, with 1,675 residential and 105 commercial units housed withing 61 properties and located throughout Magdeburg and Berlin, from Zentral Boden Immobililen late last year.

Vojkan Brankovic, principal at the privately held Apeiron (along with Jacob Cronstedt), said the two companies had backing from Middle Eastern and Asian institutional investors, as well as large family offices, and had now secured additional funding from its investors. In a press statement the company said, "Apeiron has reaffirmed its commitment to the German residential property market by increasing the target AUM for its joint venture platform from €300m to €1bn over the near to medium term."

Brankovic said the joint venture would look to invest the capital over the next 12-18 months, with assets being upgraded and held for 3-5 years. “We feel we need to move fairly quickly, as there’s been a yield shift in the past 12 months,” he said. “There are still very good transactions to be done.” 

Kauri CAB, run by Hagen Kahmann and Julian Brown, which in the past has worked with Pramerica Real Estate Investors in a Luxembourg-based joint venture, will be overseeing day-to-day management of the portfolios. The Berlin-based firm started in 1998 and has since made over 100 investments in the city, managing more than 2,500 units for their own business.

On the company's latest JV plans with Apeiron, CEO Hagen Kahmann commented, "Since our first investment the market has remained extremely lively. Berlin offers an attractive investment environment for residential portfolios long-term, particularly for second-hand properties, and is still one of the fastest-growing markets worldwide. As part of our strategy we're still on the lookout for attractive off-market deals. With our experience of many years, we're well capable of adding plenty of extra value to properties through active building and asset management."