Union Investment significantly expanded its real estate solutions business with institutional customers in 2022. Assets under management in institutional retail real estate funds and special funds, individual fund solutions and Service KVG mandates grew by more than 15 per cent in the current financial year and now total EUR 19.8 billion (as at 30 November 2022). So far this year, Union Investment has acquired capital commitments totalling more than EUR 1.1 billion from institutional real estate investors.
Between January and November 2022, EUR 874 million was invested in Union Investmentās retail funds and special funds for institutional investors. In addition, individual real estate solutions for cooperative institutes and for major customers saw further expansion. By gaining two new mandates and extending existing ones, investment assets in the Service KVG mandate segment grew by around 11.5 per cent compared to 2021, totalling EUR 11.9 billion as at 30 November 2022. A total of 41 purchase transactions were carried out and three properties were sold. The solution portfolio for Union Investmentās institutional customers now comprises 35 products, including 22 Service KVG mandates.
Union Investment was also successful in terms of acquisitions for institutional retail funds, special funds and club funds in 2022. As at 30 November, 17 purchase transactions had been carried out for these institutional products and three properties had been sold. The most notable transactions include the second construction phase of the Siemens Campus in Erlangen, which Union Investment acquired for major customers via a club deal.
Despite the current challenging market environment, the institutional part of Union Investmentās business is set for further growth in 2023. āThe changed interest rate environment is already creating selective investment opportunities. We see opportunities in particular where properties are looking for capital and we can offer customers the chance to participate in an exclusive investment case via a joint venture or club deal,ā said Maximilian Brauers, a member of the Management Board of Union Investment Institutional Property GmbH, Hamburg. He added: āOver the coming years, we intend to further diversify our institutional customer base through real estate solutions that meet higher ROI requirements against the backdrop of a stricter regulatory regime. This will enable us to tap into additional sources of capital for medium to high value transactions in the real estate markets. That also includes institutional capital from outside Germany.ā
