Leading global investor and developer Round Hill Capital has acquired 541 rental units in Greater Berlin for €89 million.
The residential for rent units in seven assets were purchased in three transactions. In the first, 497 residential units were purchased in five assets from TAG Immobilien AG (‘TAG’), the listed German residential investment company. They are located in Hennigsdorf, Königs Wusterhausen, Ludwigsfelde, Stahnsdorf and Potsdam.
A further 44 units in Greater Berlin have been acquired in off-market transactions from two local market sellers. These comprised a further property in Königs Wusterhausen, near the Tesla Gigafactory at Grünheide and Berlin’s new BER airport, as well as in Strausburg, to the east of Berlin. Both new build properties will have the highest German Energy efficiency rating upon completion.
Energy-efficient rental units
Two of the seven assets have an energy efficiency rating of A, while the remaining properties are currently rated B-C. Round Hill Capital is planning a targeted capex investment programme to maintain and upgrade these ratings.
The acquisitions were made on behalf of the Round Hill Capital European Residential Income Fund II (ERIF II). ERIF II closed in May 2023 with around €440 million in equity commitments and targets Core/Core Plus returns by investing in multifamily opportunities in strong locations with positive demographic trends, persisting supply/demand imbalances and strong transport links.
Purpose-built rental housing has proven to be resilient throughout market cycles, demonstrating its defensive qualities during the current uncertain and inflationary environment and against a backdrop of rising interest rates.
Round Hill Capital has a high-quality residential for rent portfolio for ERIF II with around 2,600 units across Germany, Ireland, the Netherlands, Denmark and Finland.
Michael Bickford, CEO at Round Hill Capital, says, “These acquisitions build further momentum in our goal of assembling a high-quality portfolio of residential for rent properties in supply constrained markets across Europe on behalf of ERIF II. The fund still has significant dry powder to deploy into similar assets with the right fundamentals, targeting core/core plus returns from lower risk profile assets, particularly as they become available in the current uncertain market conditions. Germany has always been an attractive market and one which we have been active participants for nearly two decades across a number of strategies on behalf of different clients.
“We established ERIF II to invest for the long term. To date we have amassed a high-quality portfolio of multifamily assets across Europe performing above benchmark, to which we add our recent acquisitions in Greater Berlin.”
