Bouwfonds Investment Management (Bouwfonds IM) has launched a new infrastructure fund for institutional investors. “With the Bouwfonds Communication Infrastructure Fund II we are offering institutional investors in Germany the opportunity for the first time to take a stake in the expansion of the country’s telecommunication infrastructure and thereby safeguard Germany’s sustainability,” says Jaap Gillis CEO Bouwfonds IM. The “Bouwfonds Communication Infrastructure Fund II” aims to invest between 500 million and 600 million euros in “passive tele-communication infrastructure”, such as fibre optic networks. The proportion of debt financing is around 50 percent. In an initial closing, approximately 100 million euros were raised among leading insurance companies and pension funds. The overall target is to raise up to 300 million in equity. The Fund is structured as a Luxembourg Limited Partnership SCS. Warburg Invest Luxembourg will act as Fund Service Provider, while M.M. Warburg & Co Luxembourg will act as Custodian for the Fund. The new Fund is open to institutional investors for a minimum investment of 10 million euros, and a distribution yield of 5.5 to 6.5 percent per year is indicated.

“The Fund focuses on regional and local access networks in Germany in areas that are currently underserved and have sufficient size and population density,” explains Bas van Dongen, Managing Director Communication Infrastructure Germany of Bouwfonds IM.
Investments will primarily be made in fixed-line networks, with a smaller share of the fund’s assets being invested in communication towers and data centres. “More than 80 percent of the fund volume is targeted for investment in German infrastructure, primarily in areas lacking sufficient broadband coverage. The Fund focuses on the long-term letting and leasing of fixed-line networks, communication towers and data centres, which together constitute the so-called ‘passive’ level of the communication infrastructure,” says Dr Peter Selgert, Director Asset Management Bouwfonds IM. Bouwfonds IM expects to make the first investments shortly.

Bouwfonds IM, the real asset investment management division of Rabo Real Estate Group, launched its first communication infrastructure fund in the Netherlands in 2008 and has since built up an experienced infrastructure team in Germany also. For the telecommunication infrastructure segment, it currently has assets under management worth about 800 million euros.

Bouwfonds IM has noted the explosive demand for data transmission capacities due to the constantly increasing use of internet and mobile communications services. “Meeting this demand will become increasingly important for national economies. However, this requires substantial upgrading of telecom and cable networks,” explains Martin Eberhardt FRICS, Country Manager Bouwfonds IM Germany. As the necessary investments cannot be made by the telecommunications companies alone, new and attractive investment opportunities are becoming available for institutional investors.