UK property fund manager Activum SG is seeing opportunities for attractive deals in Germany, while avoiding the increasingly popular British market, where it expects further price falls to come, its founder said yesterday.
Activum, which plans to spend about 400 million euros (US$574 million) in Europe in the next three years, is mainly focusing its efforts on Germany’s commercial property market, and is eyeing deals that give annual yields of as much as 10 percent.
“Germany is still one of the most attractive real estate markets in the world ... rents and values have been relatively stable,” Saul Goldstein, founder and managing partner of Jersey-based Activum said in a telephone interview.
“A lot of capital chased yields in Germany over the past four years using massive leverage, and a lot of these assets will be disgorged,” said Goldstein, who previously headed Europe real estate advisory at private equity firm Cerberus.
ACQUISITIONS
Activum, which is targeting to raise between 100 million euros and 150 million euros from US and European foundations and family offices for its first fund, made a first closing in August last year and so far has acquired two German commercial properties, he said.
The fund’s first purchase, in December, was an office and retail complex in Berlin whose owner had become insolvent, and in July, it bought a Frankfurt office building from a real estate subsidiary of troubled German lender WestLB.
“We love stressed and semi-distressed assets. When sellers recognize how much work it is to reposition an asset like that ... that gets reflected in the price,” said Goldstein, who declined to disclose financial details on the deals.
On Tuesday, German real estate fund manager Union Investment said it bought the Mercado shopping mall in Hamburg for 164 million euros in the country’s largest individual property deal so far this year.
Goldstein said the Activum fund was aiming to return between 1.5 to 2.5 times equity to its investors at the end of its seven-year fund life, and is avoiding Britain despite a sharp correction seen there over the past two years.
“I don’t think the UK has experienced the full range that it should ... to think that in a few years you’ll have a complete correction of the market is ridiculous,” he said.
LINGERING WEAKNESS
His views gelled with some experts who warn a sustained revival was still some way off because of lingering economic weakness in Britain, despite recent data which raised hopes of an imminent recovery in Britain’s battered property market.
“Another problem with the UK is there is a lot of capital chasing things now ... unlike in Germany where most of the funds that had bought with high leverage have pulled out. Now is the best time to be in a market like that,” Goldstein said.
STILL COMMITTED: The US opposes any forced change to the ‘status quo’ in the Strait, but also does not seek conflict, US Secretary of State Marco Rubio said US President Donald Trump’s administration released US$5.3 billion in previously frozen foreign aid, including US$870 million in security exemptions for programs in Taiwan, a list of exemptions reviewed by Reuters showed. Trump ordered a 90-day pause on foreign aid shortly after taking office on Jan. 20, halting funding for everything from programs that fight starvation and deadly diseases to providing shelters for millions of displaced people across the globe. US Secretary of State Marco Rubio, who has said that all foreign assistance must align with Trump’s “America First” priorities, issued waivers late last month on military aid to Israel and Egypt, the
France’s nuclear-powered aircraft carrier and accompanying warships were in the Philippines yesterday after holding combat drills with Philippine forces in the disputed South China Sea in a show of firepower that would likely antagonize China. The Charles de Gaulle on Friday docked at Subic Bay, a former US naval base northwest of Manila, for a break after more than two months of deployment in the Indo-Pacific region. The French carrier engaged with security allies for contingency readiness and to promote regional security, including with Philippine forces, navy ships and fighter jets. They held anti-submarine warfare drills and aerial combat training on Friday in
COMBAT READINESS: The military is reviewing weaponry, personnel resources, and mobilization and recovery forces to adjust defense strategies, the defense minister said The military has released a photograph of Minister of National Defense Wellington Koo (顧立雄) appearing to sit beside a US general during the annual Han Kuang military exercises on Friday last week in a historic first. In the photo, Koo, who was presiding over the drills with high-level officers, appears to be sitting next to US Marine Corps Major General Jay Bargeron, the director of strategic planning and policy of the US Indo-Pacific Command, although only Bargeron’s name tag is visible in the seat as “J5 Maj General.” It is the first time the military has released a photo of an active
CHANGE OF MIND: The Chinese crew at first showed a willingness to cooperate, but later regretted that when the ship arrived at the port and refused to enter Togolese Republic-registered Chinese freighter Hong Tai (宏泰號) and its crew have been detained on suspicion of deliberately damaging a submarine cable connecting Taiwan proper and Penghu County, the Coast Guard Administration said in a statement yesterday. The case would be subject to a “national security-level investigation” by the Tainan District Prosecutors’ Office, it added. The administration said that it had been monitoring the ship since 7:10pm on Saturday when it appeared to be loitering in waters about 6 nautical miles (11km) northwest of Tainan’s Chiang Chun Fishing Port, adding that the ship’s location was about 0.5 nautical miles north of the No.
RSS