A German investment manager launching a property fund has made reference to covid-19-related food supply issues as a driver for institutions to consider the ‘food retail’ asset class.
Hamburg-based Deutsche Investment, which has real estate assets under management of €1.6 billion, has launched the Food Retail I fund as an open-ended alternative investment fund and plans to invest €300 million in German food markets and retail units linked to grocery supplies.
The fund targets a yield of 5.25% to 5.50% and Susanne Klaussner (pictured), who heads the investment team, says long-term leases, high-net-worth tenants and stable rental yields found in the food retail sector are drivers for returns.
“Especially in the current situation, it becomes readily apparent that resupplying the population via the in-store food retailing segment plays a key role in Germany, and that this segment is clearly more resilient against the online competition than other retail segments,” said Klaussner.
The fund requires a €10 million minimum subscription and aims for a 45% gearing ratio.
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