Heitman LLC (Heitman) has announced the first close of ‘Heitman European Residential Investment Partners’, a closed end, co-mingled fund with the strategy of aggregating and managing a portfolio of for-rent residential properties in western Europe. In a related transaction, Heitman also announced that its fund has closed on a seed investment comprising 1,595 German private for-rent residential units, containing 108,578m² from Grainger PLC.
The portfolio is spread over 110 buildings located in western Germany mostly across the high barrier to entry metro areas of Frankfurt and Mannheim. The institutional grade portfolio formed the majority of Grainger’s residual assets in Germany. As part of the acquisition of the seed investment, Heitman will onboard Grainger’s Frankfurt-based investment specialist team. Heitman will continue to manage Grainger’s final remaining German assets in an institutional environment pending disposition.
Targeting approximately €250m in equity commitments, the fund will focus on assembling a portfolio of small- to medium-sized, rented residential properties and larger single assets across western Europe for core/core+ investors. Heitman, expects the fund will pursue further investments across Germany with appealing demographics and economic growth potential, including select German cities such as Dresden and Leipzig. The fund will also take advantage of the firm’s strong pipeline and deep relationships in the Netherlands and particularly in Amsterdam to assemble the portfolio. Heitman is now believed to be one of the largest private residential landlords in Amsterdam, having recently acquired a residential portfolio in the city.
Gordon Black, senior managing director for Heitman, commented: “Today’s announced seed investment and the launch of Heitman European Residential Investment Partners along with onboarding of a highly talented residential specialist team is indicative of Heitman’s conviction in the merits of this strategy, specifically, the ‘Living Sectors’ – rented residential, as well as student and senior housing – where we see good relative values. We are very excited by our newest acquisitions which represent a win-win for both Heitman and Grainger and our respective European investments.”
