Bouwfonds sees big interest in €250m car park portfolio

Market observers will have noted the rise of car parks as an asset class recently, with leading operators such as APCOA notably rising their profile and their physical presence at key events such as the recent Expo REAL in Munich.

Dutch real estate group Bouwfonds Investment Management was early to see the potential, and has raised several funds dedicated to the asset category. It has now put a €250m car park portfolio on the market, with Cushman & Wakefield handling the bidding process. The portfolio comprises 17 car parks in five European countries – Germany, the UK, France, the Netherlands and Spain, with locations on the high street in key European cities, in locations such as the Champs Élysées in Paris and Mayfair in London.

First bids were due last week and the portfolio is expected to attract a lot of interest from core, long-income investors.

Speaking at a panel session on Alternative Investments at the Expo REAL earlier this month, Dr. Edgar Zoller of German lender BayernLB commented on the attractiveness of the attractiveness of the category for lenders in light of the huge liquidity in the market looking for alternative asset classes.

Bouwfonds Deutschland's own Martin Eberhard said "Car parks can generate a better return than an office. And everyone needs to park." Supply is also tight because few new car parks are being built, he said, whereas demand for such assets is growing. Subsequently, returns are falling and prices are rising, although a car park can still yield a return of around 5.5%, he said.

Earlier this month Bouwfonds announced that it had raised the full amount of equity for its third institutional car park fund, Bouwfonds European Real Estate Parking Fund III (BEREPF III) which is now closing. In total, BEREPF III raised €177 mln, around €125 mln of which was raised among institutional investors in recent months as part of a second closing.

The fund’s investment volume will total €350m and it will invest in commercially sustainable car parks in Europe, particularly in Germany, the UK, France, the Benelux region and Scandinavia. The fund already has investments in four properties.