Heitman, a US-based real estate investment management firm, has unveiled a new absolute return UCITS IV-compliant real estate fund that targets European commercial property market.
Known as the Heitman European Real Estate Opportunities Fund (HERO), the Luxembourg SICAV strategy aims to invest in listed securities (mainly equities) that provide exposure to the European real estate sector.
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Launched with an initial seed capital of EUR25m from Heitman’s financial partner Old Mutual, the fund will tap long-term investment fundamentals of European real estate, with tight risk controls and daily liquidity.
The fund seeks to produce a stable annual net return in the range of 8 to 10%, a large component of that comes from income.
The investment management of the fund will be overseen by Mark Abramson, managing director and head of Heitman’s European public real estate securities group, from his Munich office.
Employing a long/short-style investment strategy, the fund uses derivatives to protect its net asset value and reduce volatility and invests based on proprietary fundamental securities and market research.
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By GlobalDataAbramson said: "We are thrilled to be the first to bring this solution to investors, delivering real estate returns in a regulated, onshore, hedged, and daily liquidity format. We believe the timing for this launch couldn’t be better, given the available investment opportunities in the market."
