With "BUILDIM", MIMCO Capital launches a new real estate fund focusing on real estate development in Luxembourg. MIMCO Capital intends to benefit its investors from the economic and demographic growth that supports the activity in the Grand Duchy of Luxembourg, based on the good fundamentals of the German market.
The Luxembourg real estate market is today one of the most dynamic in the European Union. Supported by strong economic and demographic growth, it is experiencing an unprecedented development. "The numbers speak for themselves. Between 2017 and 2018, the country's GDP grew by 2.6%. Growth in economic activity should be around 3% for this year and 2020, according to the latest forecast from Statec, "said Christophe Nadal, co-founder of MIMCO Capital. "It is also the 1st country with the highest GDP per capita in the world in 2018 according to the IMF. This healthy dynamic attracts many actors, individuals and companies, eager to establish themselves in this small territory. Real estate is developing strongly, creating new investment opportunities. "
Luxembourg, a fast-growing real estate market
In 2020, the value of office property in Luxembourg will reach 32 billion euros against 23 billion euros in 2014. This represents a growth of 40% in 6 years. The housing price index, for the whole of Luxembourg, saw an average annual increase of 5% between 2010 and 2018 representing a cumulative increase of 54.8% over this time interval.
The Luxembourg real estate market has also demonstrated resilience during the 2008 crisis with a 1% decline in prices.
The growing appetite for real estate is confirmed with an annual growth of 2.2% of the resident population in Luxembourg resulting in an annual deficit of additional housing estimated at 3000 per year (source STATEC). High-end real estate is the fastest-growing market because of the country's high standard of living, which attracts wealthy investors and wealthy non-residents.
Invest in quality assets with growth potential
It is in this context that MIMCO Capital has decided to create an investment fund oriented towards the Luxembourg market, with the desire to benefit its partners from new opportunities. The new fund, called "BUILDIM", in the form of a Luxembourg SICAV, is part of the Alternative Investment Fund (AIF) category. It will provide investors with exposure to diversified, high quality real estate assets with value creation potential.
"Our new BUILDIM fund is focusing its investment strategy on the development of high-end residential projects in Luxembourg or on the restructuring of commercial buildings or existing offices," comments Christophe Nadal. "This strategy is in line with those already implemented with MERCUREIM and EVEREST ONE, two funds focused on the revitalization of real estate on the German market. In order to achieve the investment objective, BUILDIM intends to capitalize on investment opportunities in the Luxembourg and German real estate markets where our teams benefit from exclusive and quality sourcing. "
Value Added Assets with Value Creation Potential
In a logic of consolidation, by seeking growth at the heart of a particularly dynamic and confidential Luxembourg market, BUILDIM will make its investors benefit from the stability of a market with solid fundamentals.
"We invest in real estate assets or real estate transactions that have real potential for valuation," says Bernd von Manteuffel, co-founder of MIMCO Capital. "We provide our investors with privileged sourcing through our recognized expertise in this industry. Our positioning in Luxembourg and Germany allows us to access rare and quality real estate operations before they are put on the market. The notoriety acquired by MIMCO Capital, its founders and its teams allows us to benefit from arbitrations carried out by international investment funds, banks or family offices, private owners, but also to take advantage of opportunities arising from bank liquidations, and shareholdings."
Master the real estate value chain
The MIMCO Capital team benefits from asset management and property management skills combined with in-depth knowledge of the German and Luxemburg real estate markets. This is what makes today its singularity and strength. Indeed, very few players own the entire real estate business chain, from sourcing to property management, through asset management. It is this aggregate of skills that allows MIMCO Capital to master all stages of the revitalization of a real estate asset, an approach that requires great expertise.
A demanding acquisition policy
The term of this first compartment of funds is 5 years with an opening to the collection until December 31, 2020 [MOU1]. "The target size of the fund is about 60 million euros per compartment. We take the party to control our annual acquisition rate with the strong desire to be more efficient and demanding on the selection of investments, "says Christophe Nadal. "This type of fund is suitable for investors looking for the performance and value redistribution of closed-end funds as well as optimal returns on very high value-added transactions."
BUILDIM provides a share class allowing investors an annual buy-back of 5% of the capital. The annual performance targets, calculated net of entry fees, are between 8 and 10% depending on the class of action chosen.
For professional investors in Europe
Investors will benefit from 0% entry fees for the year 2019. Exit conditions were introduced from 12 months of holding with a degressive exit fee of up to 0% at the end of the fund. The SICAV BUILDIM may be housed in Luxembourg life insurance contracts in the form of FID or FAS.
This fund is intended for a clientele of family offices, wealth managers, IFAs and private banks. BUILDIM is intended for professional investors within the meaning of the 2014/65/UE – MiFID II directive and informed investors within the meaning of Luxembourg law. Investors should be aware of the risks of capital loss and seek professional advice.
The MIMCO Capital team is at your disposal to inform you.
