Corestate subsidiary HFS exceeds mezzanine fund volume mark of €1.2bn

Helvetic Financial Services (HFS), a wholly-owned subsidiary of Corestate Capital Holding, has exceeded the €1.2b fund volume mark for the first time, it announced this month.

The Wollerau, Switzerland-based mezzanine finance provider is currently financing around 60 projects with a combined volume of €7b, of which almost 80% are residential.

‘Over the past 12 months alone, under the umbrella of Corestate, we are proud to have raised the fund volume by well over€150m,’ said Tim Schymik, COO of HFS. For Dr. Michael Bütter, CEO of Corestate, HFS represents ‘a great example for the effective integration and enhancement of an already successful business model in the Corestate Group’. ‘HFS provides a considerable contribution to the group’s total earnings, without us taking any project development risks of our own,’ he said.

Corestate acquired HFS in July last year for an undisclosed sum. HFS offers subordinated capital for urgently needed residential development in German metropolitan areas. Around 60% of the projects it finances are in Germany’s ‘Big 7’. Corestate’s real estate AUM rose by 3.7% (or €600m) q-on-q to €16.8b at the end of the first quarter this year.

DIC Asset launches €400m Office Balance V fund

Other asset managers have also been busy this month. Frankfurt-based DIC Asset has just launched its seventh open-ended special alternative investment fund (AIF). The new fund, DIC Office Balance V, will invest in commercial real estate in German metro regions on behalf of institutional investors, thereby continuing the strategy of former Office Balance funds in the series. The target investment volume is between €350m and €400m.

The start-up portfolio comprises two buildings in Munich and Hamburg with a combined value of €130m, which were added to the fund at the end of last monthusing a corresponding amount of equity capital. The annual target return is expected to be between 4% and 4.5% annually.

‘Demand for office real estate remains very high in cities like Hamburg and Munich,’ said Sonja Wärntges, CEO of DIC Asset. ‘The high-end start-up portfolio of two assets, which we secured for the fund as early as 2017, permits us to ensure stable rental demand and continuous rent revenues for our investors, and we are convinced that DIC Office Balance V will generate permanently sound distribution yields,’ she added.

DIC Asset has been included in the SDAX segment of the Frankfurt Stock Exchange since June 2006. (ssk)