Fortress, the US private equity group, this week closed a €2bn (£1.3bn) fund that will invest in German residential property, a market expected to grow by €20bn (£13.6bn) in the next three to four years.
Blackstone in December snapped up a portfolio of residential properties from WCM Beteiligungs and Grubesitz for €1.39bn (£951m), following Fortress’s €3.5bn (£2.39bn) acquisition of 78,000 flats from state-owned Gagfah last autumn.
US private equity groups are vying for a portfolio of 170,000 flats owned by German utility Eon.
An investment banker advising US funds said: “US private equity groups are attracted by a 5-7% yield with potential for a 50-75% capital gain.
“Demand from tenants for home ownership is strong, fuelled by low interest rates.”
References: EGi News 18/04/05
