M&G raises €578m for European property fund

UK asset manager M&G announced it has raised €578 million for its new continental European residential property strategy.

M&G said it has expanded its international real estate fund range with the launch of the M&G European Living Property Fund, building on its €1.5 billion UK residential property investment strategy, which has provided 3,500 rental homes to date.

M&G Real Estate is part of M&G plc’s £76.7 billion Private & Alternative Assets business with European offices in Amsterdam, Frankfurt, Luxembourg, Madrid, Milan, Paris and Stockholm.

“Designed to provide institutional investors with index-linked rental income, house price exposure and geographical diversification, the fund invests in student, private rented sector and retirement housing,” said M&G.

“With supply/demand imbalances evident across Europe, M&G aims to use its network of local teams and in-house expertise to create additional supply of high quality, sustainable housing.”

The fund launches with €578 million of capital from two investors and a €75 million acquisition of 124 recently refurbished apartments in a landmark Art Nouveau building in central Helsinki.

The Helsinki property is the first building in Finland to receive the highest green building certification for its class in Europe for features including re-use of waste heat.

MN — one of the largest pension administrators and asset managers of Dutch pension funds — has committed €400 million as part of its strategy to diversify and internationalise its residential exposure.

The £133 billion Prudential With Profits Fund has also invested €178 million as part of its longer-term strategy to increase its exposure to the residential sector in Europe, on behalf of up to 5 million customers in the UK.

M&G CEO Jack Daniels said: “By investing in purpose built living accommodation, we can provide more homes that meet the needs of today’s renters, while supporting wellbeing, sustainability and communities.

“Expanding the reach of our residential capabilities into continental Europe is a natural progression, building on the experience and expertise we have developed over the past decade in the UK, and complementing our growing European real estate investment platform.”