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22.10.15

Real Estate fund developments in Germany

Open-ended mutual real estate funds in Germany have seen an increase in investments. The net inflow amounted to €1.7 bn in the first quarter 2015, which was a 100% increase on the first quarter of 2014. The ongoing search for suitable properties and financing structures by asset managers and investors is driving the industry's internationalisation: other juridictions offer legal forms which may better suit the new requirements of the investors. Again, Luxembourg is one of the preferred juridictions. CACEIS leverages its extensive capabilities to service clients. At the same time, non-EU fund initiators are starting to sell funds to institutional investors in Germany, in compliance with AIFMD and KAGB. For those managers, CACEIS has an effective solution in place. 

Furthermore, rising pressure on revenues and expenses forces asset managers to consider outsourcing non-core activities. Recently, big German players have already outsourcing their in-house real estate fund administration units to service providers. This is driving a trend, as the first requests for proposal of open-ended real estate managers can be seen on the market place. Managers of newly-licenced closedended funds are also looking for external administration solutions. As one of the Top-3 depositaries for real assets in Germany, CACEIS is a strong partner and can provide in the short-term additional services such as accounting, corporate and regulatory reporting and investor management.

In the meantime, the German real estate depositary market continues its consolidation. In previous years, well-known players like Sal. Oppenheim, withdrew  from depositary services. As a result, there are currently 13 active depositaries, with only a few big players in this market. 

CACEIS is the leading independent real estate depositary and is benefitting from the consolidation. Two German public institutions are heading the market – however, they are running a large-scale captive businesses only. For closed-ended funds, there are only six depositaries active on the market and CACEIS is the new market leader in terms of assets.

 

 

 

 

Holger Sepp, Board Member of CACEIS in Germany