Europa Capital, the pan-European real estate investment manager, has raised €350 million in a first close of its new open-ended vehicle, the Europa Diversified Income Fund(EDIF), with seed capital from its principal shareholder, Mitsubishi Estate Co., as well as backing from European and Asian institutional capital.
The Europa Diversified Income Fund, which is designed for an international investor audience, is focused on creating stable and diversified income through investing in logistics, residential and offices.
The Fund will capitalise on the structural changes of innovation and urbanisation, targeting strong economies in Western Europe, with a focus on France, Germany, the Netherlands and Denmark.
Through favourable sector weightings and leveraging Europa Capital’s value-add asset management skills, the Fund will aim to provide long-term outperformance of market benchmarks, for which ESG considerations are a key performance metric.
The initial seed portfolio, totalling c. €350 million of NAV, comprises a mix of logistics, residential and office investments. The portfolio, which has outperformed its market indices to date, is 99% occupied and has recorded 99% rent collection in both Q2 and Q3 2020, demonstrating its resilience during the COVID-19 pandemic. With accretive leverage, the Fund has capital remaining to deploy into further acquisitions to diversify the portfolio.
The Fund has also recently completed the acquisition, in partnership with Keystone Investment Management, of the first of three residential buildings in the Øresund region of Copenhagen.
Andy Watson, Partner & Fund Manager at Europa Capital, added: “EDIF represents a new brand of core fund. With no assets in retail and hospitality and no UK exposure, there are currently no legacies dragging on performance. EDIF is a fund that blends the principles of core investment with elements of value generation, leveraging Europa Capital’s 25 year track record in value add asset management.
“The momentum of this first close will lead to the further growth and diversification of the Fund with a broad range of international investors. Importantly, some two thirds of EDIF’s annual income is in logistics and residential which we see as the most resilient property sectors in this period of unusual uncertainty.”
Rob Sim, Managing Partner at Europa Capital, commented: “The launch of EDIF marks a major strategic milestone as we expand and diversify our fund management capabilities beyond value add to core investment leveraging our longstanding track record and expertise as we mark our 25th anniversary. EDIF also holds great significance to Mitsubishi Estate as a cornerstone investor and our majority shareholder, adding a European component to their global suite of open-ended core investment products, which already span the US and Asia.”
Europa Capital were advised by Greenberg Traurig.
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