German asset managers join forces to launch US property boutique

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A German asset management boutique and a US property investor, both based in Germany, have launched a joint venture to create a new company targeting institutional and private clients looking to invest in US real estate.

The Feri group, based in Bad Homburg near Frankfurt, and US Treuhand, based in Darmstadt, will form new company UST Immobilien GmbH.

US Treuhand manages at present a multi-billion euro portfolio through a third-party firm, Florida-based Estein & Associates USA, that oversees the buying and selling of US properties.

Estein & Associates USA will continue to manage the assets when US Treuhand ceases to exist as a separate entity and will merge its assets into UST Immobilien GmbH.

The joint venture comes ahead of the new so-called 'KAGB'  regulation which come into force in July this year and aims to stem illiquidity problems which have plagued many German property funds over the past few years

To comply with this new regulation, Feri will oversee the portfolio and risk management of the funds and will keep its current structure - three separate entities divided up into asset management, rating and research units - a spokesperson confirmed to Citywire Global.

Feri will hold a 32.5% interest in the company, the remaining shares being held by Lothar Estein, founder and owner of US Treuhand, and by Volker Arndt, US Treuhand’s managing director.

'Real asset classes are gaining increasing significance both for institutional investors and for high-net-worth individuals, and directly held properties represent a core element of any strategically-oriented portfolio of tangibles.'

'The collaboration is an important part of our strategy to generate more options for direct investments in tangible assets,' said Arnd Thorn, CEO of Feri AG.

The new company will have its headquarters in Bad Homburg and will start by launching exclusively close-ended funds.