Civitas Investment Management Limited (Civitas) acquired a €300m portfolio consisting of 26 elderly care and assisted living homes predominantly located in Berlin and Hamburg, Germany from Deutsche Wohnen, a subsidiary of Vonovia SE. Civitas has made the investment, on behalf of the Civitas European Social Infrastructure Fund.
Simultaneously, Civitas is entering into long-term lease agreements for the 3,000+ bed portfolio with Alloheim Group which will acquire the incumbent operator, Katharinenhof and will continue to deliver high-quality care and support for the residents. Alloheim is Germany’s number one care operator with 265 care and assisted living homes and has a strong positive reputation across the elderly care market.
The portfolio will meet Civitas’ ESG investment criteria of delivering positive social impact in local communities and improved environmental considerations through an extensive capital expenditure programme which aims to see more half of the portfolio achieve an EPC rating A. In addition, Civitas and Alloheim have agreed green lease obligations which aim to minimise carbon emissions from the operation and occupation of the properties.
Nikolay Velev, Head of Europe, Civitas Investment Management commented: “This investment is particularly important for Civitas, marking our entry into the German market and significantly expanding our European presence, where in the short to medium term we are seeking to deploy up to €1b into investments in high-quality assets and locations with strong operators. The European later living market is no longer a nascent sector but is an established and fast-growing segment. It represents a highly attractive risk-return proposition with inherent downside protection to our investors through its positive supply/demand imbalance, legislative and obligatory funding, and strict regulatory oversight to ensure quality of care provision. We are delighted to be partnering with Alloheim, a highly regarded care operator which shares our ethos of delivering exemplary customer service.”
Tom Rietz, Managing Director, Alloheim Group, commented: “We are delighted to expand our footprint with the acquisition of a high-profile operator such as Katharinenhof and to enter into a new long-term partnership with Civitas with whom we share a common commitment to providing best in class care, support and suitable accommodation for the later living community. We look forward to expanding further our relationship with bolt-on acquisitions.”
Civitas was advised by TSC Real Estate, Greenberg Traurig, PwC, Drees & Sommer and Savills.
Written by Leon Goldwater for Europe Real Estate.
Image source - TSC Real Estate.
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