Chenavari backs German student housing fund with €50m RCF

European credit asset manager Chenavari Investment Managers has provided a €50 million revolving credit facility to Luxembourg-based student housing investor Deutsche Real Estate Funds (DREF).

The facility will finance DREF’s investment in student housing and raises the fund’s amount of available investment capital to €150 million. DREF is aiming to double the size of its German student housing portfolio this year, after investing €135 million last year.

“The revolving credit facility provides us with the necessary flexibility to move fast once we’ve selected an attractive value-add opportunity. In current market conditions, speed is a major factor in determining success as demand for good quality residences in central locations is extremely competitive,” said Felix Bauer, CEO and CSO of Deutsche Real Estate Funds Advisor.

DREF lets more than 3,500 residential units under the Twenty First Student Living brand. In June 2015, DREF issued the first bond for the funding of student housing in Germany. At the request of some investors, the bond volume was increased to €77 million last November.

“DREF’s first bond issue to finance student accommodation facilities established this type of investment for German institutional investors,” said Sam Mellor, partner and senior portfolio manager for European real estate funds at Chenavari. “The company’s leading expertise and first mover advantage together with our previous successful track record with management in what we see as a sector with huge growth potential are key to us providing DREF with the necessary financial capacity for further growth.”