The Fidelity Eurozone Select Real Estate Fund has finished its latest round of capital raising, bringing in €111m in just 12 weeks.
Institutions across Europe including France, Germany, Ireland and Switzerland have been the primary funders as investors continue to search for income from core Eurozone markets.
With property offering 200-400bps premium to Eurozone government bonds and real estate fundamentals continuing to favour landlords, the asset class remains a “relatively attractive” home for capital, the investment firm said.
Fidelity International will embark on its next round of capital raising with a target close in Q2 2017. Investor demand is expected to come from Europe but also Asia-Pacific and Australia.
The core, euro-zone-focused real estate fund is exclusively aimed at institutional investors.
Over the last five years, the fund has returned 9.2% per annum with an outperformance of 5.6% per annum against the INREV Continental Europe Funds Index1 and has a distribution yield of 4%+. The fund operates a bottom-up approach to stock picking where the Fidelity team analyses every property on its individual merits.
Neil Cable, head of Real Estate at Fidelity International said: “Fidelity’s focus on high quality income from institutional grade real estate in the core Eurozone markets has resonated with investors seeking alternatives sources of investment grade income. Post Brexit, investors have also seen the merits of a core Eurozone strategy with Fidelity’s fund being one of the very few core open ended fund offering nil exposure to the UK and peripheral Europe.”