CommerzReal targets €2bn new resi investment, bets big on crowdfunding

The Commerz Real open-ended real estate fund hausInvest intends to invest about €2bn in residential real estate within the next five years by teaming up with Wertgrund Immobilien, the Commerzbank subsidiary said in a recent statement.

The fund will invest in existing properties and construction projects in German cities and university towns with a minimum volume of €50m and a focus on affordable properties, including publicly-subsidised housing.

Wertgrund will accompany the transactions, and be responsible for the entire asset and property management. The purchase decision and the fund management remain the responsibility of Commerz Real. If things work well, the strategy could be extended to other European markets in the long term.

According to Andreas Muschter, CEO of Commerz Real, “Residential real estate is a very interesting asset class and excellently suited to further diversifying the portfolio of hausInvest. On the one hand our investors profit from the experience and market access of a successful specialist such as Wertgrund, and on the other hand from the familiar high quality of our fund management.”

Hausinvest, which has assets under management of about €14.4bn, has primarily invested in commercial real estate, with residential property as an addition in individual properties.

Thomas Meyer, a member of the board of Wertgrund Immobilien, said of the partnership, “With the capital strength of Commerz Real and our expertise in the field of residential real estate we intend to develop a residential real estate portfolio throughout Germany and Europe in the medium to long term. In this respect we set great store by partnerships with project developers and local councils above all. The first projects are already in the exclusive acquisition assessment phase.”

Separately, the €31bn CommerzReal said it was taking a 24.9% stake in the crowd-investing platform Bergfürst, financing it by way of a capital increase. The stake (for an identified amount) makes CommerzReal the second-largest shareholder behind Bergfüst founder and board member Guido Sandler.

Founded in 2011, Bergfürst offers project developers and the holders of real estate portfolios standardised access to mezzanine financing. Bergfürst currently has more than 35,000 clients and to date has successfully financed more than 50 real estate projects with a total volume of over €54m.

Andreas Muschter, the CEO of Commerz Real said the shareholding is a further step to ”becoming a digital asset manager”. He added, “This also includes identifying and developing alternative, new business models. In recent years crowd-investing and equity crowdfunding have developed as alternative investment and financing forms and are being used by more and more investors and project developers.”

Bergfürst’s Guido Sandler said: “The participation of Commerz Real is pleasing acknowledgement of our achievements and underlines the quality of our platform.”

Sandler said the capital increase and the creation of joint structures will have a positive impact for the company on many levels. “In addition to an expansion of the client network, Bergfürst also expects that the speed, number and volume per issue can be increased significantly in the short term. Furthermore, we are profiting from the expertise of the leading asset manager in the real estate sector and naturally this cooperation will also foster greater trust with a view to our acquisition of new clients.”