- HIH Invest Real Estate launches residential investment fund for institutional investors
- Property development of nine buildings in Osnabrück
- 241 residential units with a combined lettable area of 18,800 square metres
- Seller is BPD Bouwfonds Immobilienentwicklung
- Neighbourhood development includes grocery and other retail units and social amenities
- Completion scheduled for Q1 2024
Hamburg/Osnabrück, 28 October 2021 – HIH Invest Real Estate (“HIH Invest”) is launching a new investment fund called “Wohninvest Quartiere Deutschland” for institutional investors, such as insurance company, superannuation schemes and pension funds, that will focus on residential neighbourhood developments. The institutional club fund will qualify as Article-8 fund under the Sustainable Finance Disclosure Regulation (OffV) and concentrate on the new-build construction of large-scale housing estates in German cities with positive demographics. The planned fund volume approximates 500 million euros while the contemplated distribution will equal about 3.25 to 3.75 percent annually. The minimum subscription amount is 25 million euros.
The residential development in Osnabrück represents the first acquisition that HIH Invest Real Estate notarised on behalf of the fund. It was sold by BPD Bouwfonds Immobilienentwicklung (“BPD”), one of the largest property developers in Europe. Within the framework of a neighbourhood development, nine residential buildings of three to four storeys are being constructed to the sustainable KfW efficiency house 55 EE standard in the Landwehrviertel locality in Osnabrück. A total of 241 residential units will be created on a combined lettable area of roughly 18,800 square metres, with twelve percent of the flats earmarked for subsidised housing construction. The underground car park will deliver 224 car and 438 bicycle parking spaces, with additional car-sharing spot planned. The acquisition of the properties took the form of an asset deal with a forward funding structure. It was agreed not to disclose the selling price.
Klaus Niewöhner-Pape, member of the Investment Committee Residential at HIH Invest Real Estate, said: “It is impossible to predict the long-term consequences of the coronavirus pandemic. However, it is not without reason that residential investments are considered resilient. Especially the segment of mid-market or low rents is currently a safe bet for institutional investors. This is all the more true for markets characterised by pent-up demand – Osnabrück being case in point.”
Neighbourhood Development
Nadine Robra, Team Leader Transaction Management Germany at HIH Invest, reported: “The plot is located in a section of the Landwehrviertel locality in the Eversburg district of Osnabrück. Here, on a military brownfield called “Quebec Barracks” of 37 hectares, the largest continuous development area of Osnabrück is being developed.”
The idea underlying the new quarter is to develop a recognisable high-end district structure, supplemented by social infrastructure, shopping venues and park areas. “The first construction stages of the quarter, including day nursery and Montessori primary school have already been completed,” added Nadine Robra. “The new-build quarter offers a family-friendly environment and predominantly flats of two to four bedrooms. In addition to educational facilities, there are businesses that complement the family-friendly residential format.” The green spaces, playgrounds and sports facilities nearby imply strong recreational potential. A REWE grocery store that opened up in 2020 lies within walking distance. The site also comes with convenient public transport links to downtown Osnabrück and to the central railway station, which offers high-speed train service (about 15 minutes away), and great inter-regional road connections via the A1, A30 and A300 motorways.
Investment Plot
The investment plot is located in the south-eastern part of the quarter. Overall, BPD will construct nine buildings to an energy-efficient new-build standard (KfW efficiency house 55 EE standard) in two construction stages. The buildings of three or four storeys will be supplemented by a recessed storey and deliver a total of 241 residential units.
The BPD team under Tobias Stüber (Head of National Investor Sales), Carl Smeets (Head of North Rhine-Westphalia Branch) and Thomas Trendelkamp (Head of Property Development Düsseldorf), is looking forward to the project: “We at BPD attach great importance to the development of sustainable and liveable residential accommodation in our quarters, including here in Osnabrück. In HIH Invest, we found a partner who was instantly convinced of our approach. Pursuing a reasonable densification at this site enables us to ensure a resource-conserving development while ensuring a high quality at the same time. By continuing to play a definitive role in the neighbourhood development and to watch over its steady growth, we neatly bridge the gap between planning effort and a lived-in residential area.”
“Residential real estate, especially in the segment of three-bedroom flats, remains very much in demand. Also sought-after are locations outside the urban centres – not just because of the price; the pandemic has made living in green settings more attractive again,” elaborated Tom Kircher, fund manager at HIH Invest Real Estate. “The surrounding green spaces and playgrounds enhance the appeal that the Landwehrviertel is supposed to have, especially for families.”
Osnabrück, which is the fourth-largest city in Lower Saxony and an economically strong regional city with a growing population (165,000 residents today) while also being a campus town and home to companies from the automotive and logistics industries, attracts a large number of students and high-skilled workers.
The legal and tax due diligences (DD) were carried out by the law firm of Heussen Rechtsanwaltsgesellschaft mbH in Munich.
“It is impossible to predict the long-term consequences of the coronavirus pandemic. However, it is not without reason that residential investments are considered resilient. Especially the segment of mid-market or low rents is currently a safe bet for institutional investors. This is all the more true for markets characterised by pent-up demand – Osnabrück being case in point”
Klaus Niewöhner-Pape, member of the Investment Committee Residential HIH Invest Real Estate
“The plot is located in a section of the Landwehrviertel locality in the Eversburg district of Osnabrück. Here, on a military brownfield called “Quebec Barracks” of 37 hectares, the largest continuous development area of Osnabrück is being developed.”
Nadine Robra, Teamleader Transaction Management Germany HIH Invest Real Estate
“The first construction stages of the quarter, including day nursery and Montessori primary school have already been completed. The new-build quarter offers a family-friendly environment and predominantly flats of two to four bedrooms. In addition to educational facilities, there are businesses that complement the family-friendly residential format.”
Nadine Robra, Teamleader Transaction Management Germany HIH Invest Real Estate
“Residential real estate, especially in the segment of three-bedroom flats, remains very much in demand. Also sought-after are locations outside the urban centres – not just because of the price; the pandemic has made living in green settings more attractive again. The surrounding green spaces and playgrounds enhance the appeal that the Landwehrviertel is supposed to have, especially for families.”
Tom Kircher, Fund Manager HIH Invest Real Estate
“We at BPD attach great importance to the development of sustainable and liveable residential accommodation in our quarters, including here in Osnabrück. In HIH Invest, we found a partner who was instantly convinced of our approach. Pursuing a reasonable densification at this site enables us to ensure a resource-conserving development while ensuring a high quality at the same time. By continuing to play a definitive role in the neighbourhood development and to watch over its steady growth, we neatly bridge the gap between planning effort and a lived-in residential area.”
Tobias Stüber (Head of National Investor Sales), Carl Smeets (Head of North Rhine-Westphalia Branch) and Thomas Trendelkamp (Head of Property Development Düsseldorf) BPD Bouwfonds Immobilienentwicklung
