Starwood European Real Estate Finance, a U.K.-listed real estate fund, wants to expand its holdings into Spain and Italy for the first time, moving beyond its current focus on the UK, Holland and Finland.
Managers of the fund asked shareholders for permission to pursue deals in Southern Europe, but emphasized they have no specific plans to move forward until their current funds are deployed. The fund currently controls £238 million (€287.6 million) in assets.
“The occupational real estate markets in Spain and Italy have shown tentative signs of recovery and investment demand has also significantly increased as both opportunistic and core investors have sought exposure,” the fund said.
Managers also asked shareholders for the ability to increase the allocation of residential real estate to 30 percent of the fund, up from 20 percent. But in Spain and Italy the fund intends to focus on commercial property.
“Whilst any investment in Spain or Italy would be approached with caution, the board believes that the company should have the ability on a selective basis to identify balanced risk return opportunities in these countries if and when they arise.”
The fund raised £228.5 million in an IPO last year. Its biggest investments to date have been in the Centre Point development in London’s West and retail space in Finland.
The Starwood fund only has invested about 70 per cent of its assets, and chairman Stephen Smith has acknowledged that thee pace of investment has been “slower than anticipated”, Citywire reports.