IVG Funds is launching a new closed-end fund in the EuroSelect product series: EuroSelect 18 invests into office properties in Hamburg, Nuremberg and Munich and forecasts an annual preferred payout of 6.0% for its investors up to the scheduled maturity date of December 31, 2025.
The fund will acquire the properties at Nordostpark 3/5 and 7/9 with effect from June 30, 2009; investment in the other properties is scheduled for July 1, 2010, provided, among other things, that the properties have been completed. The properties in the portfolio were assessed by two independent appraisers, Jones Lang LaSalle and Feri EuroRating Services, in order to avoid a conflict of interests upon transfer from IVG to the fund.
IVG will remain invested at the level of the property companies at a rate of 15% in each case. At present, the portfolio has a pre-letting rate of 63.0%. Along with the preferred payout, IVG has committed itself to offset any potential loss of income from the properties in 2009 and 2010.
The investment volume of EuroSelect 18 totals €91.9 million.
IVG board member Georg Reul: "We are confident about the German property market and the capital increase potential which the properties in EuroSelect 18 offer. This is why we will remain invested in the properties. With their outstanding location, above-average fittings and broad diversification, the new and good-as-new office buildings meet all the requirements for successful sustained investment."