Property FundsIrish investors are to be offered a small proportion of a €725 million property fund which will be managed by Axa Real Estate Investment Managers.
The Apollo Pan-European Fund will be investing in a range of commercial properties across western European markets, including office, retail and light manufacturing assets. The portfolio will be funded by about €260 million in equity and €450 million in debt finance, providing a loan-to-value ratio of 60-65 per cent. Friends First in Dublin is raising about €25 million in equity from Irish investors as part of the total equity commitment. One of the key attractions is that Friends First is the only one of the 16 institutions participating in Apollo that is opening up the fund to individual investors.
The minimum subscription in a life assurance investment is €75,000, up to a maximum of €1 million. Individuals can also invest a minimum single premium of €50,000 through a pension fund up to a maximum of €1 million.
Apollo is a closed end fund, with an investment term of about six years. Friends First say that investors will not have to wait six years to begin realising returns, as Apollo is also planning to return an average dividend to life assurance policyholders of 4-5 per cent per annum over the term of the investment. For pension fund investors, Friends First will manage any distribution until the term of the fund expires.
The fund will target properties across a range of countries in western Europe: France (30 per cent); Spain (20 per cent); Germany (15 per cent); Italy (15 per cent); the Benelux (10 per cent); and other markets (10 per cent).
The fund has already seed properties valued at €202 million. The fund has achieved a weighted average net rental yield of 7.08 per cent to date.
Properties with a total net value of €145 million are scheduled to close in the coming months, subject to final due diligence. These include a portfolio of 12 offices in the Netherlands valued at €73 million and six office buildings in Berlin worth €45 million.
