Empira Group taps the megatrend of metropolitan living with new "Urban Living" fund

• New, inflation-adjusted investment strategy in small-scale housing in urban locations
• Excellent socio-demographic data in the target markets
• Fund pursues environmental and social characteristics in line with Article 8 of the SFDR Sustainable Article 8 fund
• Innovative tenant app with user-focused, target group-oriented, fully digital leasing and rental management workflow

SAVVY Berlin-Friedrichshain; Copyright: Linus Lintner

The Empira Group, a leading investment manager for institutional real estate investments, is expanding its product offering for institutional investors with the "EMPIRA Urban Living" fund*. The new fund invests in urban and furnished residential properties in the top seven cities in Germany.

"In a tense inflationary environment and a persistent inflationary trend, we have developed a product with the 'EMPIRA Urban Living' fund, which offers our investors the opportunity to not only compensate for inflation, but to beat it," explains Lahcen Knapp, President of the Board of Directors of Empira Group. "Investing in the high-quality, furnished residential properties in Germany's sought-after trendy districts that are included in the fund is not new in itself, but we have created a residential concept of the future and thus real added value with our specially developed digital services," says Knapp.

Over the years, Empira has observed the potential tenant clientele of national and international commuters, expatriates and project employees from high-income sectors of the economy, and has incorporated the experience into the development of the user-oriented app. Empira expects this to be what the residential rental industry will look like in the coming decade, and that's what makes these properties so special.

"With us, 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 explains further. In addition, the old real estate adage speaks for the "EMPIRA Urban Living" fund: location, location, location. The seed project portfolio of around 1,000 residential units consists of eight properties and residential projects in trendy neighbourhoods in the cities of Berlin, Hamburg, Munich and Cologne.

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.

Proof of Concept successfully opened in Berlin-Friedrichshain
The first project of the seed portfolio in Kreutzigerstraße in Berlin-Friedrichshain with 135 residential units and a commercial unit on the ground floor was opened in May 2022 and has been fully let since June 2022. "The project has remained both on schedule and on budget in a challenging environment and we have already significantly exceeded rental income and market value projections," says Knapp.

Empira is developing the residential properties, as well as actively managing the assets during the holding period. The new buildings will achieve significant CO2 savings each year. The portfolio will emit significantly less CO2 than regular portfolio properties. Empira generally follows principles in investments and developments that are ESG compliant and sustainable.

*EMPIRA Urban Living SCSp SICAV-RAIF