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Pension fund to co-invest with Allianz in European debt fund

5 building icons represent a supplier warehouse, retail store, bank, and 2 office buildings.

German pension fund Bayerische Versorgungskammer (BVK) will co-invest €300m in a sub-fund alongside investments by Allianz Group, in a move that allows the partners to increase their exposure to quality assets.

Allianz Real Estate, the real estate asset manager of Allianz Group, said that it is focused on developing its third-party business, and hopes to accelerate demand for co-investments in new sub-funds.

A spokesperson for Allianz Real Estate told Expert Investor: “We have opened our European debt fund to third-party investors and offer joint ventures and co-GP structures to equity partners. We are offering third-party investors the opportunity to invest alongside Allianz, broadening the group of investors that have access to our capability, although Allianz will remain our major client.

“Like many other institutional investors, the Allianz Group has a growing appetite for alternatives, with real estate the largest asset class for them.”

The Parec fund, based in Luxembourg, was launched in mid-2018 to simplify access to European debt investments for Allianz Group insurance companies.

Following regulatory approval, BVK will invest in a sub-fund valued at €1.2bn, which belongs to a fund with €3bn of assets, as of end of 2019, Allianz Real Estate said.

Quality assets

The fund will invest in real estate debt of the highest-quality from prime borrowers, with core/core-plus assets located in prime locations in tier 1 European cities. Most recently, the fund provided debt financing for the acquisition of an office building in Dublin.

It is structured to suit pension funds and insurance investors, who are regulated under the Solvency I and Solvency II regime.

Roland Fuchs, head of European real estate finance at Allianz Real Estate, commented: “Our pan-European origination presence and in-house loan asset management team has enabled us to stay close to our borrowers through 2020’s unprecedented months and to remain open for new prime lending opportunities.”

Elena Johansson

Senior Reporter