The Catella European Residential III Fund (CER III), the first pan-European ‘dark-green ’ESG impact fund for residential real estate, has raised around €280 million from seven German and Dutch institutional investors, as its total assets under management passed the €1.0 billion milestone.
CER III, which is managed by Berlin-based Catella Residential Investment Management (CRIM), has a diversified portfolio of investments in seven European countries encompassing around 30 properties. Several assets in the Netherlands, France, the UK, and Spain are also in due diligence. CER III’s most recent acquisition, and its second in the UK market, was the purchase of the Gramercy Tower apartment building in Cardiff.
Michael Fink, Managing Director, CRIM, said: “The CER III impact fund has a laser focus on the ‘decarbonization transition’ in its residential investments and we are also strongly committed to societal fairness through targeting affordable rents. The fund achieves a high standard of governance by adopting Nassim’s Taleb’s concept of ‘skin in the game,’ or alignment of interests between the manager and investor, through its fee structure and is attracting increasing numbers of like-minded institutional investors who share our ESG principles.”
The Fund targets the reduction of greenhouse gas emissions and has sustainable societal objectives in its investments. CER III has also integrated a penalty clause into its management agreement whereby CRIM will donate part of its recurring management fee to a relevant impact-related United Nations charity, should the manager fail to meet the financial, environmental, or societal objectives set for the fund. This strengthens the third ESG pillar - the governance factor (G) - and links investor and fund manager interests in the fee structure. Nassim Taleb contends that when investor and manager both have real ‘skin in the game,’ or measurable risks in a major investment decision, and share these risks between them, this results in higher standards of fairness and transparency through a greater alignment of interests.
Casper van Grieken, Executive Director, CBRE Netherlands - Head of Capital Advisors, concluded: “Europe is battling a chronic affordable housing shortage, rising energy bills and a climate emergency. CER III has clear objectives to address these issues in its investment strategy and philosophy. For instance, by investing in the world’s first energy-positive residential towers through the joint venture between Catella and French sustainable engineering group Elithis. These buildings produce more energy than the buildings including the tenants consume, eliminating household energy bills and boosting disposable income. It is great to see this strategy coming to life and growing quickly!”
CBRE Capital Advisors are mandated to advise on fundraising from international investors.
About Catella Residential Investment Management GmbH (CRIM)
Catella launched its first European residential fund in 2007.The team also launched the first dedicated European Student Housing Fund in 2013. CRIM is a subsidiary of the Stockholm-based Catella AB Group and its residential real estate business comprises portfolio management, acquisitions, sales and asset management. CRIM manages and advises several funds and mandates and has assets under management of more than €6.5 billion across 11 European countries.
About CBRE Capital Advisors
CBRE Capital Advisors works closely with real estate managers and investors as corporate finance advisor with a background in the commercial real estate market. The team, consisting of international experts, are skilled to support and assist in preparing and completing transactions and to provide real estate professionals with strategic and tactical advice for all indirect property investment queries, including topics as property funds, joint ventures or club deals, or related strategic organizational questions.
CBRE Capital Advisors B.V. is licensed by the Authority for Financial Markets (AFM) and acts as placement agent to raise international capital for CERIII outside of Germany.
For more information, please contact:
Catella Residential Investment Management GmbH
Head of Marketing and PR European Residential
Office: +49 (0)30 887 285 29 76
Mobile: +49 (0)151 544 51 005
stine.zoechling[ at ]catella-residential.com
Picture: L’Ecrin vert (Auderghem, Belgien)