Manager wins capital for CASA V as well as Austrian and German funds
Henderson Global Investors has raised $105m for a follow-on US multi-family housing fund. The manager has also won more capital for two German and Austrian property funds launched this summer. But it has put back the September closing date for its second Central London Office Fund (CLOF 2).
Head of global distribution Tim Horrocks said three existing US public fund clients had come into CASA V, which will invest in US apartments. Henderson hopes the fifth fund will be the biggest yet and has a $400m equity raising target to build a $1bn portfolio.
The CASA series owns 61 properties with 20,520 flats in 25 markets; assets bought and sold since 1999 had shown an average internal rate of return of 13.2% as of 2010. Horrocks said raising capital for repeat funds where Henderson has a proven concept was easier than launching new products. “In the current fund-raising environment it is very hard to get off the ground, so for CASA V we decided to have a first closing with existing investors. Now we will go further afield.”
The CASA strategy is to buy apartments financed with low-cost, tax-exempt bonds to generate a value-added return of 11-13%, supplemented by some prime core apartments to balance the fund geographically or strategically. Fund V’s first acquisitions are 344 flats near Seattle and 346 near Southpoint Mall in Durham, North Carolina.
Horrocks said another €15m had been raised for the German Retail Income Fund, taking it to €100m, and about €35m for the Warburg-Henderson Austria Fund 2, taking it to a similar size. The investors are small German occupational pension funds and two insurance firms.
The target for each fund is €150m, which, with gearing, will enable them to invest €300m. Albert Yang, Henderson’s director of institutional business, has left. He is believed to be joining JP Morgan Asset Management.