DIC Asset launches second retail fund, plans special dividend
German listed commercial property investor DIC Asset AG is launching a new Spezialfonds, its sixth overall and second focused on retail. The fund, named “Retail Balance I”, will invest in core and core-plus retail real estate in German metro regions and follows its first retail fund, “Highstreet Balance”.
The fund is targeting an investment volume of €250m, aims for a 5% annual return, and will have a lifetime of eight to twelve years. It has already been seeded with a portfolio of three non-discretionary retail centres and retail warehouse parks valued at €190m in late-September. The assets, with a gross lettable area of 60,000 sqm, are located in the Hamburg suburbs of Harburg and Bergedorf, and in Berlin (The "Storchenhof").
According to Dirk Hasselbring, board member and Head of Fund Business at DIC Asset, “Demand among end consumers for non-discretionary retailers and retail warehouse parks that stock groceries and convenience goods remains as strong as ever despite the online business, and this in turn generates a stable demand for lettable floor space and a steady flow of rent revenues. We are convinced that Retail Balance I, the way we developed it, is an optimal product that will generate a consistent and sound dividend yield.”
The SDAX-listed DIC Asset has been steadily increasing its fund volume, and says it has more than achieved its planned target returns so far. Its other four investment funds are in its "Office Balance" series, reflecting the company's traditional strength in the office sector in the country's largest cities. Overall the company now has 180 assets with a combined market value of €3.4bn.
Separately, DIC Asset plans to pay out a one-off extraordinary dividend of at least €0.20 to its shareholders after the takeover of listed WCM Beteiligungs- und Grundbesitz-AG, in which the company had a stake, by listed TLG Immobilien. The sale led to a one-time extraordinary income of about €19m, which DIC Asset wants to return to shareholders.