M7 Real Estate has launched a fund focusing on the German retail sector that the firm expects to increase to €100m (£70m) of assets under management.
The M7 European Real Estate Investment Partners I fund is the first from the pan-European investor and asset manager for third-party investors focused on the Continent.
It has made its first purchase – a portfolio of eight properties totalling 38,350 sq m for €46m, a price representing an 8.7% yield. The portfolio comprises four supermarkets, three retail warehouses and a retail park across Germany. M7 will take on the asset management of the portfolio when the deal completes in September.
The fund’s first close raised around €16m of equity. The second close is expected to raise a further €24m, taking the potential gross asset value of the fund to €100m with a 60% gearing level.
Richard Croft, chief executive at M7, said: “We are looking to put investor equity to work immediately and so capital-raising for our funds is asset specific. Since we have identified additional investment opportunities, we anticipate a second and final equity close in August.
