KINGSTONE in first close, launches €400m healthcare property fund

German owner-managed investment management group KINGSTONE Real Estate has launched its first healthcare property fund, targeting a gross asset value of €400m.

The vehicle, "KINGSTONE Living & Care I" (KLC I), which is being issued together with IntReal International Real Estate KVG as the fund’s service-providing capital management company, will invest in full and partial inpatient nursing facilities, outpatient care facilities, assisted and age-appropriate living, as well as health centres and medical-care centres in Germany and Austria.

Gerontological rehabilitation clinics also fall within the investment focus of the open-ended alternative investment fund (AIF), which is classified as an Article 8 fund for the purposes of the Sustainable Finance Disclosure Regulation (SFDR).

KINGSTONE Real Estate has already completed its initial equity capital closing for KLC I. The core fund is aimed particularly at financial institutions investing for their own accounts, foundations, pension funds and insurance companies. The focus will be on individual real estate assets beginning at an acquisition volume of around €10 million.

According to Paul Muno, managing partner of KINGSTONE Living & Care, "Due to the increasing demand arising from an aging society, the healthcare assets offer great potential for institutional investors, particularly under consideration of ESG criteria. Successful investments require very precise market expertise, though. We invest specifically in sustainable individual properties with modern building fabric and efficient operator concepts."

Muno, who joined the company this year after years of experience with Principal Real Estate Investors (ex-Internos), among others, said that KINGSTONE Living & Care's pipeline stretched right across Germany, although there was probably a current bias towards southern Germany, where the company has deeper roots.

Tim Schomberg, managing partner and CEO of KINGSTONE Real Estate, said: "Over the last few months, we've built a team of healthcare specialists with and in-depth understanding of both the investment and operating sides. We consider this to be the key component for long-term fruitful investments in this complex asset class".

The Schomberg family, together with Pegasus Capital Partners, established the group last year offering a range of investment products and a holistic approach to German and international institutional investors. Earlier this month the group bought a substantial fully-leased, multi-tenant mixed residential and office property in the Bavarian city of Ingolstadt for a separate account mandate, the KINGSTONE Bavaria Süd (KBS) fund.

The fund is an open-end alternative investment fund set up for Sparkasse Rosenheim-Bad Aibling, a savings bank based in the southern German city of Rosenheim. Again, IntReal International Real Estate is acting as the fund's service-providing capital management company (KVG). The fund’s total target is at least €150 million and the ticket price for individual properties is in a range between of €15m to €25m.