Private equity real estate fund and asset manager Whitewood Capital is continuing its expansion across continental Europe with the opening of a Prague office in the Czech Republic. This underpins the launch of a Central Europe unlisted core-plus/value-add commercial real estate fund.
The establishment of an office in the Czech Republic extends Whitewood Capital's growing European platform.
Christopher Millen, Joint Managing Partner at Whitewood, said: "The opening of a regional office in Prague is an initial, important building block in the development of our Central European strategy. Despite the impact of the global financial crisis, it is currently one of the region's top destinations in terms of economic stability, investor appeal and access to quality, relatively well priced product."
With the establishment of its CE presence, in continuation to its two prior unlisted funds, Whitewood is launching its new 'CAPE III' (Capital Preservation and Enhancement) Central
European unlisted fund for institutional investors, for which it is aiming to raise an initial equity tranche of 60 million in a first close which leveraged, will provide the fund with ca. 150 million to acquire a portfolio of pre-identified office and retail properties predominantly across Prague.
A timely second close of ca. 100 million equity, will then provide an additional ca. 250 million of spending power across the region to bring the fund to its target size of ca. 400 million.
The Fund's investment strategy is Core Plus/Value Add, with a focus on office and retail properties across Central Europe with a strategic allocation to Czech Republic, Poland, Austria, and select Slovak and Hungarian geographies.
The fund is to be structured as a CSSF regulated Luxemburg FCP, with various feeder vehicles tailored to varying investor categories and geographies and is targeting distributions on equity of 7.50%+ per annum and a target IRR (income plus capital growth) of 12 to 14% per annum.
"We believe the CE office and retail segment currently offers attractive risk adjusted return opportunities which combined with Whitewood's active asset management including re-leasing and cosmetic refurbishment, offers the potential for increasing capital value and improving our investor's cash-on-cash returns," says Frédéric Van der Planken, Joint Managing Partner at Whitewood Capital Group.
"Additionally, the region offers a large number of possibilities for acquiring quality core-plus and value add investments at pricing levels inherently more attractive than those observed in the period of 2005-2008, the majority of which we are able to source off-market via the backgrounds of our senior management and our broad broker network" Van der Planken continues.
Commenting on the launch of the Fund, Peter Koritschan, Director of Investor Relations at
Whitewood Capital, stated: "We are seeing continued appetite from international investors to acquire Central European office and retail real estate. We believe this is the right time to invest in these asset classes and we are confident that our team of real estate professionals will be able to deploy the capital quickly and generate the target returns for our investors."
CAPE III is the third in a series of regionally focused, unlisted funds, launched to capitalize on re-pricing opportunities emerging in the market place as a result of distressed vendors and the reduced availability of debt.
Source: Whitewood Capital