Valad Europe has announced the first £150m equity raise of a £375m fund to invest in the UK and Germany.
The Valad European Diversified Fund will employ between 50% and 65% leverage with strong cash-on-cash yields.
Equity for the fund has been provided by several large international investors, including a new investor partner for Valad Europe.
Debt financing will be sourced from a pool of lenders with whom Valad Europe already has existing relationships and who have supported Valad Europe on other mandates.
The fund has already bought a 26,242 sq ft retail warehouse in Aintree, Liverpool, let to Wickes.
It has exchanged contracts to buy a South East office asset in the UK and has also secured a German logistics portfolio and a retail asset in Frankfurt.
Valad chief investment officer David Kirkby said: “We envisage a narrowing of the prime-secondary spreads during the fund’s life both in the UK and German real estate markets and our local teams are seeking to purchase good value, high quality, and leasable assets with strong covenants.
“In the UK, offices in regional city centres, especially in the South East, and retail warehouses currently provide good value investments, while in Germany, offices in the top and second tier cities and nationwide distribution warehouses are priced attractively.
“We have actively targeted and secured our initial investments in the UK and Germany and our future pipeline of opportunities is strong.”
nick.whitten@estatesgazette.com
