Henderson Global Investors has raised a further €90m (£74m) for its German retail fund, taking its total firepower to €350m.
The Henderson German Retail Income Fund now has 12 investors, comprising German insurance companies and pension funds, after the oversubscribed second close at the end of last year.
Using gearing of up to 50%, the fund now has around €350m to deploy exclusively in the German retail warehouse market, which performed strongly last year.
Average initial yields in the sector stood at 6% in the final quarter of 2012. This compares with 4.9% for shopping centres, 4.75% for offices, and 6.75% for logistics.
HGRIF fund manager Thilo Wagner said: “German retail warehouses were star performers throughout 2011. They continue to offer attractive initial yields compared with those in other countries and with other sectors in Germany.”
Research director Stefan Wundrak added that Germany’s attractiveness should be considered in the context of the economic environment across Europe and also take into account the respective sector and occupier market outlook.
In the UK, retail warehouse yields stood at 5.25% at the end of last year after increasing demand pushed yields in. This compares with 5.25% in France, 6.25% in Sweden, 7% in Italy, 7.25% in Spain and 8% in Portugal.
The fund has invested €60m in four assets located in Forcheim, Köln-Hürth, Ulm-Nersingen and another close to Düsseldorf since its first close in summer last year.
It has a “significant” pipeline of further assets that fit the core to core-plus investment criteria. Its target income return on investment is a minimum of 6% pa with an end portfolio consisting of 12 to 15 assets.
Wagner added: “The fact that the fund was oversubscribed reflects the strong appetite for the vehicle, which is an excellent fit for current investor requirements, providing direct access to core retail assets.”
