Catella Investment Management (CIM), Catella Investment Management Benelux (CIMB) and AIFM platform Catella Real Estate AG (CREAG) have successfully sold an extensive real estate portfolio to a subsidiary of Lone Star Funds for the fixed-term institutional fund "Panta Rhei Dutch Residential" (PDR). This will be accompanied by the liquidation of this fund as planned. The transaction will combine Catella's European investment management platform with the company's local expertise in the Dutch residential real estate market.
The divested portfolio comprises 13 properties in the Netherlands, including 923 residential units, eight commercial units and 505 parking spaces with a total area of around 62,739 square metres. The investment concept was classified as "Core+" (according to the INREV style classification). The focus was on regions with a positive demographic outlook and tight supply to build a diversified, yield-optimised portfolio across regions and residential segments.
In the start-up phase, the fund took advantage of regulatory changes as well as additional liquidity caused by social housing providers. Throughout the investment cycle, investors benefited from investing in the Dutch private rental housing market due to rising rental prices, appreciation and an attractive risk-return profile. The Dutch market remains one of the most attractive markets in Europe and leads in some regulatory aspects, for example as the rent level is linked to the quality of the building (EPC label). The strong demand for residential property provides additional liquidity in the Dutch residential real estate market compared to other European markets. Over time, the fund raised more than EUR 150 million of equity with an investment volume of over EUR 250 million, spread over 16 properties. The final sale of 13 properties for around EUR 215.5 million resulted in attractive returns for investors. Over its fourteen-year life cycle, the fund achieved an average annual net return[1] of over 5.5% p.a.
Michael Keune, Managing Director at Catella Investment Management, says: "This smooth end-of-life divestiture perfectly rounds off the strategy's successful fourteen-year track record. We are proud to have delivered on what we promised our clients when the fund was launched. A high occupancy rate over the entire life cycle of the portfolio has resulted in stable net returns, in line with investor expectations."
Otto Rompelmann, Managing Director at Catella Investment Management Benelux, adds: "As this was the first fund initiated by CIMB, we consider this successful transaction to be an important milestone for Catella and our investors. The attractive performance is largely due to the expertise of our local asset management team combined with our extensive investment management skills and proven external advisors. It serves as a proof of concept for further innovative investment strategies tailored to the opportunities in the Benelux market."
The "Panta Rhei Dutch Residential Fund" was launched in October 2012 as a German special AIF under the German Investment Act (InvG), with Catella Real Estate AG acting as management company (KVG) and Catella Investment Management Benelux as local asset manager. As an experienced partner in the Netherlands, CIMB advised on acquisitions and asset management with local market expertise, while CREAG and its advisor CIM focused on fund management and investment management. Together, the Catella teams accompanied the fund throughout its investment cycle – from acquisitions to asset management and successful disposal.
