21 December 2018
Union Investment’s institutional real estate business continues to grow
• Investment assets up by 13 per cent
• 14 acquisitions made for institutional retail and special funds
Union Investment achieved strong growth in its institutional real estate business in the year now ending. Compared to the prior year, institutional investment assets in actively managed funds, Service KVG mandates and pooling vehicles rose by a total of 13 per cent (as at 30 November 2018). With funds under management of approximately EUR 10.3 billion (prior year: EUR 9.1 billion), Union Investment confirmed its leading position as a provider of institutional real estate solutions.
“We have exceeded our growth targets, with Service KVG mandates making a notable contribution.”
Wolfgang Kessler, Member of the Management Team at Union Investment Institutional Property GmbH
By gaining new mandates and extending existing ones, between January and November 2018 investment assets in this area grew by some 50 per cent to a total of EUR 4.5 billion.
Union Investment was also successful in terms of acquisitions. For the full year 2018, Union Investment expects acquisitions for its institutional retail and special funds to come in at around EUR 705 million. Alongside 14 acquisitions, disposals worth EUR 170 million were made in the first eleven months of the year. A total of 46 properties with a value of more than EUR 2.0 billion were acquired as part of Service KVG Mandates.
The institutional part of Union Investment’s business is set for further growth in 2019:
"Alongside our established solutions, we intend to introduce innovative new investment products that will allow us to develop additional lucrative niche markets.”
The solution portfolio was extended in the past year through the launch of ZBI Union Wohnen Plus. The open-ended real estate fund has a core plus profile and is structured as a special AIF. It is the first joint product for institutional investors to be set up by Union Investment and ZBI Zentral Boden Immobilien AG (ZBI). The fund’s investment focus is on residential real estate in selected locations and growth regions across Germany.
Union Investment’s institutional real estate business picked up Scope Awards in two categories in 2018. The award in the Institutional Real Estate Germany category acknowledged the strong performance of the UniInstitutional German Real Estate fund and of Union Investment’s seven special funds that focus mainly on Germany, including UII GermanM. In explaining its decision, the jury particularly praised the broad product range for institutional customers. The award in the Institutional Real Estate Operator-Run Properties category recognises the successful positioning of special funds UII Hotel Nr. 1 and Urban Living Nr. 1. Union Investment launched Urban Living Nr. 1 to provide its customers with the opportunity to invest in the high-growth niche market for micro-living real estate.
For Union Investment Institutional Property GmbH