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MIMCO REVITALIZE: A new MIMCO AM fund focusing on real estate revitalization in Germany

The MIMCO AM teams are excited to launch a new investment vehicle focused on real estate revitalization in Germany: the "MIMCO REVITALIZE" fund.

In accordance with article L. 214-144 of the French Monetary and Financial Code, this fund is intended exclusively for professional and professional-like investors in France who meet the conditions set out in article 423-27 of the AMF's General Regulations: family offices, asset managers, independent asset management advisors and private banks.

This product involves a risk of capital loss. Investors should seek advice from licensed professionals.

This is an advertising communication. Please refer to the Prospectus, Regulations and Key Investor Information Document before making any final investment decision. These documents are available in French here ("Documents" section).

Germany, a real estate market with strong fundamentals1

According to the « Immobilienmarkt Deutschland 2020/2021 » study written by the real estate bank DZ HYP in December 2020, it seems that  German real estate investors’ interest has not waned despite the changed economic conditions. It shows that the German market remains strong overall, with the residential sector showing particularly strong demand, as illustrated by the current increase in property prices in the suburbs and secondary towns. 

"Unlike France, Germany is a decentralised country organised into 16 "Länder". In our opinion, this decentralisation gives it the advantage of a greater dispersion of populations and, consequently, a large number of dynamic secondary towns. We believe that because of its regulation over many years, the not very cyclical German property market has very low prices today compared to its European neighbours. Not to mention the attractive German tax system, which improves returns for investors," says Bernd von Manteuffel, co-founder and CEO of MIMCO Capital Group.2

The German real estate market is among the most dynamic in the euro zone

Germany's statistical office, Destatis, reported that the eurozone's largest economy contracted by 5% in 2020 (compared to 5.7% during the 2009 crisis). Having benefited from state support measures, the country has nevertheless weathered the health and economic crisis better than its neighbours.3

Whilst Germany was already the largest construction market in Europe in 20194, the global health crisis did not prevent it from experiencing a further increase of 4% in the volume of construction in 20205. With not only a triple A rating from Fitch Ratings and Standard & Poor's in 2020, an unemployment rate of 5.7% in June 2021,6 but also the fastest increase in property prices in the G20 in Q1 2020 (+9.4%),7 the dynamism of the German market can no longer be questioned, particularly in terms of real estate.

"Despite the potential for long-term growth in corporate remote working, we can expect the demand for office space to continue to grow, driven by a strong German economy.8 In this context, our experience of the German real estate market and our analysis of its evolution, as well as its current trends, enable us today to foresee and anticipate new opportunities."

Focus on a value-added investment strategy in Germany

MIMCO AM has chosen to launch "MIMCO REVITALIZE" in the form of a mutual fund ("Fonds Commun de Placement") under French law, within the category of Alternative Investment Funds (AIF). The Fund's investment policy focuses primarily on the revitalization of buildings intended primarily for office, retail, and residential use. The revitalization of these buildings will allow for a reassessment of the rental conditions in the long term.

"With the new MIMCO REVITALIZE fund, our primary objective is to create value by bringing real estate back in line with the market through a revitalization process. To do this, our value-added acquisition strategy is clear: we redevelop increasingly complex assets and operations and adapt them to new uses, by improving both energy performance and user comfort," says Christophe Nadal, President of MIMCO AM. "The positioning of the MIMCO Capital2 group in Germany and its reputation enable us today to have access to rare, diversified and quality assets even before they are put on the market, above all thanks to an omnipresence on the ground, and therefore an exclusive and rigorous sourcing of investment projects."

The goal will be to select assets with real value-creation potential, and to consider changes in household consumption patterns, new work organisation and the latest thermal and energy standards, which require many obsolete assets to be upgraded as they are no longer adapted to the way the modern economy operates.

Control of the entire real estate value chain

Through its SRI-certified investment vehicle MIMCO REVITALIZE, MIMCO AM is involved in the entire real estate value chain: sourcing, legal and financial structuring, asset management and property management.

In addition to this, MIMCO AM has a differentiating advantage, with its in-depth knowledge of the German territory and extensive experience of the German real estate market through the expertise of its founders and the entire MIMCO Capital team: MIMCO REVITALIZE will be the first Value Added fund focused on German real estate to be launched in France.

"As our strategic monitoring makes clear, there are few players who master all the professions in the real estate chain, both in several countries and with teams of experts located as close as possible to the assets. It is this combination of skills that enables MIMCO AM to master each stage of the revitalization of a real estate asset, an approach that requires constant diligence," reveals Ara Adjennian, Managing Director and Partner of MIMCO AM.

A pledge for a healthy world, with a powerful environmental commitment

As a signatory to the UN-backed Principles for Responsible Investment since July 2021, MIMCO AM recognises that the consideration of environmental, social and governance (ESG) criteria leads to a better assessment of investments in terms of their usefulness and sustainability. This is why MIMCO AM strives to invest in real estate operations and assets taking into account sustainability criteria that respond to the new challenges of the real estate sector. 

"In line with the group's strategy of linking the financial performance of our investments to their environmental and social impact, MIMCO REVITALIZE has been awarded the SRI certification and is committed to making sustainable and responsible investments that meet the expectations of new urban uses and lifestyles. The desire to identify the best real estate opportunities with a long-term vision and high added value while being respectful of the environment is part of its DNA," says Bernd von Manteuffel.

View MIMCO AM's ESG policy here.

Invest in real estate in Germany with an SRI certified fund

MIMCO REVITALIZE is a Specialised Professional Fund (SPF) structured as a mutual fund under the terms of article L.214-154 of the Monetary and Financial Code. It is an investment vehicle with a unit issue and, depending on the fund's strategy, the recommended investment period is 8 years with a target size of €300M. This product presents a risk of capital loss. Investors should be aware of the risk of capital loss and seek advice from authorised professionals.

"Our objective is constant: to be ever more efficient and demanding in the selection of our investments. This type of fund is suitable for investors looking for an IRR of between 6 and 8% and an annual distribution target of 4.5%, in addition to a share of the excess returns target," explains Sébastien Horay, Sales Director for France.

MIMCO REVITALIZE is a fund with the status of an "AIF", registered and authorised for marketing in France by the Autorité des Marchés Financiers (AMF) but not accredited, and whose operating rules are set out in the Prospectus and the Fund Regulations.

The MIMCO AM teams are available to provide you with and additional information.

References:
1. DZ HYP, « Immobilienmarkt Deutschland 2020 / 2021 », December 2020
2. As a reminder, MIMCO Capital is an investment group that brings together a number of structures specialized in private equity real estate and investment capital. It is based in Luxembourg, Berlin and Paris through its subsidiary MIMCO Asset Management, a portfolio management company approved under the AIFM directive by the French regulator Autorité des Marchés Financiers under the number GP-21000018.

3. Le Monde, « L’économie allemande s’est contractée de 5 % en 2020, 14 January 2021
4. CCI France - Allemagne, « Chiffres clés du secteur du bâtiment allemand », 2019
5. DIW Berlin,
German Institute for Economic Research
6. German Federal Employment Agency
7. International Monetary Fund
8. Pôle Franco-Allemand, « Marché immobilier en France et en Allemagne : les tendances et les prévisions pour 2021 », February 2021

Luxembourg
MIMCO Capital S.à r.l. headquarters
Address: 25C Boulevard Royal
L-2449 Luxembourg
Tel: +352 661 988 977
Email: office@mimcocapital.com
Germany
MIMCO Asset Management GmbH subsidiary
Address: Grolmanstrasse 36,
10623 Berlin
Tel: +49 30 810 5661-0
Email: office@mimcocapital.com
France
MIMCO Asset Management S.A.S. subsidiary
Address: 87 Boulevard Haussmann
75008 Paris
Tel: +33 1 44 70 04 36
Email: office@mimco-am.com
Access to MIMCO Asset Management website