Empira’s new BTR fund covers Germany’s top seven cities

Zug-based investment manager Empira Group has launched the Empira Urban Living fund which will invest in furnished urban residential properties in Germany’s top seven cities.

The fund has a seed portfolio of property and projects that will provide around 1,000 residential units. There are currently eight properties and projects in all, located in trendy neighbourhoods in the Berlin, Hamburg, Munich and Cologne.

The first project is in Kreutzigerstraße in Berlin-Friedrichshain. It has 135 residential units and a commercial unit on the ground floor and was opened in May 2022. It has been fully let since June 2022.

Lahcen Knapp, president of the board of directors of Empira Group said that the project has remained both on schedule and on budget in a challenging environment, and has already significantly exceeded rental income and market value projections.

Empira is developing the properties, as well as actively managing the assets during the holding period. The new buildings will achieve significant CO2 savings  and the portfolio will emit significantly less CO2 than regular portfolio properties.

Empira said the aim is to develop a standardised concept for a residential property portfolio that is diversified in terms of location and is held in the portfolio for the long term. “With our develop-and-hold strategy, we offer attractive yields and regular distributions during the holding phase. At the same time, the on-average significantly shorter contract terms of our tenant clientele offer our investors even better protection against inflation,” adds Knapp. The expected return is over 10 percent IRR and a forecast distribution of over 5 percent p. a.

The company said that it has observed a potential tenant client-base among national and international commuters, expatriates and project employees from high-income sectors of the economy and has incorporated this experience into the development of a user-oriented app.

“A prospective tenant can do everything digitally from anywhere, from the first contact, to the viewing, to the rental agreement document management, to the reading and control of their energy consumption,” Knapp said.