M&G Real Estate, part of M&G Investments' €86 billion private markets business, has acquired two new residential assets in Germany and Portugal. The acquisitions have been made on behalf of the M&G European Living strategy, launched in January this year with €600 million for investment. Promoted with the support of M&G's strong local origination teams in Europe, the new assets are in line with the strategy's objective of investing in high quality properties with strong sustainability standards located in the best locations across the continent. The new acquisitions include:
- In the centre of Berlin, purchase of a residential building for €36.5 million in an off market transaction. Located in Park am Gleisdreieck and divided over 7 floors, the building offers 67 high quality private rental flats, 48 of which are open market rented. The property includes 19 subsidised flats that are fully let, providing more affordable housing in Germany's second most expensive city. With a vacancy rate of less than 1% in Berlin and with the decline in planning permissions taking place across the country, assets such as this have become particularly sought after by investors.
- In Lisbon, acquisition of a student residential development for 35 million euros. The project will offer 333 beds, spread over 315 individual studios and 9 twodios, in the Olaias district and within walking distance of the Instituto Superior Técnico Lisboa, Portugal's most prestigious engineering university. The development will help mitigate the long-standing shortage of student residences in the country, where 88% of the demand for student residences was underserved in the 2021-2022 academic year - Lisbon accounted for 43% of this imbalance.
Marcus Eilers, Head of European Residential at M&G Real Estate, commented: "We are very pleased with the acquisition of these assets, which will provide high quality residential space in markets with a severe shortage of housing supply, while helping to deliver attractive risk-adjusted returns for institutional investors in the strategy. The residential sector in Europe is showing its defensive traits, remaining resilient to the current economic challenges and offering strong diversification potential in investors' portfolios."
M&G Real Estate is one of the largest real estate investors globally, with EUR 36 billion5 in assets under management spanning real estate equity and debt strategies. In Europe, M&G Real Estate has offices in Amsterdam, Frankfurt, Luxembourg, Madrid, Milan, Paris and Stockholm.