French group La Française launches new €100m retail fund
The Paris-based La Française Real Estate Managers, the real estate investment management company of La Française group, is launching a €100m collective real estate investment vehicle (SCPI) that will invest in retail or e-commerce related assets in Europe, primarily in Germany and France.
La Française has already established an investment platform for this market, with operations in Europe's three main market places: Paris, London and Frankfurt. The group set up its first European fund in 2014, LFP Europimmo, the first French SCPI investing in commercial real estate across Europe, but initially focusing on Germany.
For the German and London markets, it relies in particular on the sourcing and investment expertise of La Française Forum Real Estate Partners, its joint venture partnership with Forum Partners in which it holds a 24.9% equity stake, and with whom it jointly acquired Cushman & Wakefield Investors last year to invest directly in European real estate.
The company said its new Europimmo Market fund was set up to take advantage of shifts in the European retail and shopping landscape, particularly in the light of the increasing role played by online buying. Assets targeted will be high street stores and shopping centres, but also higher-yielding retail logistics properties. In a statement the company said, “This dual investment strategy will enable us to diversify risk and operate in complementary but inseparable sides of the retail business. The fund will target core/ core+ retail properties in regions of retail density with the potential for high footfall and purchasing power."
La Française REM already has €2bn of retail and related assets under management, totalling more than 1m sqm and let to nearly 1,000 international retailers, out of total AUM of €13bn. Tenants include retailers such as Carrefour, H&M, Diesel, Minelli, BNP Paribas and McDonalds. The group is part of the €48bn La Française asset management group, itself a subsidiary of the Credit Mutuel Nord banking group.
Separately, La Francaise Forum Real Estate Partners (LFF) has also been active in Germany on behalf of its many French retail investors. It has invested over €140m in Germany this year, including a recent acquisition of a Munich office block from the private LHI Group. The asset, in Munich's Laim district, is let to a number of blue-chip tenants, including the Deutsche Bundesbahn.
According to Jens Goettler, LFF's head of Germany, “Munich offers a rare combination of a high level of stability with strong growth prospects from a vibrant local economy. The low vacancy rate (a little over 5%) and the limited development pipeline are working in our favour and should support high occupation rates and rental growth prospects. The multi-let profile is a good combination with our first acquisition (in Offenbach) for the SCPI, being a single tenant asset on a long lease.”
Goettler was referring to the group's €20m acquisition of a six-storey property let to Saint Gobain in Offenbach, beside Frankfurt, in this year's first quarter. With its joint-venture partner Aberdeen Asset Management, it followed that up by buying two German retail assets for €79m.