Union Investment: billions outflows from actual property funds | EUROtoday

Investors have withdrawn 3.1 billion euros from open actual property funds run by Union Investment. This implies that the destructive development worsened considerably final 12 months in comparison with 2024. At that point, the asset supervisor, who had bought the merchandise on a big scale by way of the Volks- and Raiffeisenbanken, had recorded money outflows amounting to 1.3 billion euros. “Real estate is the asset class that has corrected most significantly,” mentioned board member Frank Engels throughout the annual press convention in Frankfurt. Now the scenario would ease. “The outflows from open real estate funds will stabilize in 2026,” mentioned the board member liable for portfolio administration and actual property.

According to Engels, the truth that personal buyers specifically proceed to promote the funds is because of a downstream impact that outcomes from the twelve-month discover interval for the merchandise since 2013: Since then, open-ended actual property funds have had a statutory minimal holding interval of 24 months and a subsequent discover interval of twelve months. Selling on the inventory alternate is feasible at any time, however is commonly related to worth losses.

Such merchandise, that are highly regarded amongst German personal buyers with an affinity for actual property, had already made headlines throughout the monetary disaster between 2008 and 2011. At that point, buyers may not redeem their shares as a result of the liquidity of many funds was not ample.

Things at the moment are totally different at Union Investment, emphasised Engels. “We’re keeping the asset class liquid. And as long as we’re able to liquidate, that’s fine for retail investors in my view.” Union Investment needed to promote 43 industrial properties to be able to make sure the return of buyers’ shares. It was not foreseeable that the outbreak of battle in Ukraine would trigger inflation to rise so sharply in 2022 and set off an rate of interest shock. “This is the longest crisis, but not the hardest,” mentioned Engels.

At the second it’s primarily personal buyers who’re promoting. “Institutional investors are starting to buy commercial real estate again,” defined Engels. The workplace property market can be slowly stabilizing once more within the USA, the place Union Investment funds are invested extra closely than others.

Beyond the open actual property funds, the fund firm’s enterprise has developed nicely: Overall, Union Investment was capable of increase web new cash amounting to 23.3 billion euros. Almost 60 % of this, 13.5 billion euros, got here from personal buyers. Private clients invested ten billion euros of the brand new cash in financial savings plans. The property underneath administration of personal clients elevated to 271 billion euros (2024: 254 billion euros).

This is the second greatest gross sales consequence ever achieved, mentioned CEO Hans Joachim Reinke, who’s retiring within the spring as a result of age. Then André Haagmann, who was beforehand liable for institutional shoppers on the board, will take over as chairman. His space of ​​duty grew considerably in 2025. Professional buyers equivalent to pension funds and household places of work invested nearly ten billion euros, greater than twice as a lot new cash web as in 2024.

Reinke justifies the truth that Union Investment funds had been so common with personal clients of Volks- and Raiffeisenbanken on the premise of their good efficiency. However, buyers who spend money on them typically should pay excessive issuing surcharges to their financial institution, which the gross sales establishment collects, along with the administration charges that the fund firm receives. Union Investment doesn’t promote the considerably cheaper passive ETFs which are extraordinarily common with personal clients – the competing merchandise to those basic actively managed funds. “Of course the costs play a role,” says Reinke. But he’s satisfied that efficiency has a higher influence in the long run.