German mutual insurer Gothaer Group plans to invest around €600m ($638m) in European commercial real estate.
The investment will be made through a special fund to be set up under Luxembourg law and managed by BNP Paribas Real Estate Investment Management (REIM) Germany. The portfolio will focus on euro-zone countries excluding Germany.
Gothaer Group is one of Germany's major insurance groups and one of the country's largest mutual insurance associations with over 4.1 million members and premium income of more than €4bn.
"Gothaer is increasingly concentrating on infrastructure for its capital investments, with a focus on renewable energy and real estate," said Christof Kessler, the CEO responsible for capital investment in Gothaer Asset Management. "In the medium-term, we intend to expand our real estate ratio to 10% percent."
At present, the Gothaer Group has €2.3bn invested in real estate and the proportion of this asset class in the overall portfolio is 7.2%.
The aim is "to diversify and simultaneously to increase the overall return on our real estate assets," Kessler added.
Ingo Bofinger, head of real estate at Gothaer Asset Management, said BNP Paribas REIM Germany was contracted "largely because of their pan-European platform, as well as their track record with asset management of core and core+ real estate."
The projected portfolio will include office, retail, hotel and logistics, with individual investments ranging between €20m and €80m, predominately core and core+ properties. Some properties will also be acquired for development into core assets.
The investment is to be made over the next three to four years.