a.s.r. real estate

2019 annual reports: a.s.r. real estate funds

Entering a new market
An absolute highlight of 2019 was the launch of the ASR Dutch Science Park Fund (ASR DSPF). The Fund had an exciting first year, signing a dedicated partnership agreement with TU Delft and acquiring five assets in two science parks for a total commitment of €85 million. With a first movers advantage in a promising new market the Fund is well-positioned for a further expansion in the years to come.

a.s.r. real estate Fund exceed IPD Benchmark

a.s.r. real estate’s three established core sector funds – the ASR Dutch Core Residential Fund (ASR DCRF), ASR Dutch Mobility Office Fund (ASR DMOF) and ASR Dutch Prime Retail Fund (ASR DPRF) – are all reflecting on a highly successful year. Each Fund outperformed its sector-specific IPD Benchmark. ASR DCRF’s total return (all benchmarked assets level) was 15.8%, compared with a benchmark total return of 13.6% for 2019. ASR DMOF delivered a total return of 21.7%, compared to a benchmark of 17.1%, and ASR DPRF realised a total return of 4.6% compared to a benchmark of 3.0%.

Furthermore, the inflow of capital from investors remained strong, with €206 million in capital raised. Improved occupancy levels have contributed to the direct returns of all three funds. Acquisitions (totalling €229 million) and dispositions (totalling €69 million) have further strengthened the core profile of each fund. All funds intensified their focus on sustainability, resulting in an improved Global Real Estate Sustainability Benchmark (GRESB) score for all three funds. 

2019 Highlights

 

ASR DCRF

ASR DMOF

ASR DPRF

Total return / Income return

14.7% / 2.7%

20.3% / 6.0%

4.6% / 4.6%

Occupancy

98.6% (+0.1%)

98.0% (+1.3%)

98.7% (+0.1%)

Acquisitions

€115 m

€0 m

€114 m

Dispositions

(-)€52 m

€0 m

(-)€17 m

Capital raised

€64 m

€92 m

€50 m

Sustainability

GRESB score: 84 (+4)

GRESB score: 77 (+7)

GRESB score: 76 (+4)

ASR Dutch Core Residential Fund 

  • ASR DCRF achieved a total return of 14.7% with an income return of 2.7% (distributed).
  • The total return on property level, according to MSCI/IPD, amounted to 15.8% for ASR DCRF, compared to 13.6% for the IPD Dutch Residential Benchmark in 2019. The fund outperformed the benchmark in 2019, as well as the five-year average.
  • The Fund’s occupancy rate continued to rise, to reach an all-time high of 98.6% as at 31 December 2019.
  • The Fund added two new projects to its pipeline in 2019; the Minister in Rijswijk and Edge in Eindhoven. As a result, the total committed pipeline grew to €412m with a 94% allocation to the Fund’s focus areas.
  • The Fund sustainably renovated the portfolio assets Ambachtenlaan in Breda and RiMiNi in Amstelveen, improving the energy labels from C/D/G to energy label A.
  • ASR DCRF also improved its GRESB score to 84 points. This higher GRESB score has mainly been achieved through the Fund’s continuing commitment to the large-scale renovation of its portfolio assets (bricks) and its focus on tenant engagement (incentivising better tenant behaviours).
  • The Fund welcomed its tenth investor in 2019.

ASR Dutch Mobility Office Fund

  • The Fund achieved a total return of 20.3% with an income return of 6.0% (distributed).
  • The occupancy rate of the fund’s portfolio increased to 98% and the WALT rose to 5.5 years.
  • The uncommitted pipeline increased to €302m (LOIs signed).
  • The GRESB score improved significantly from 70 to 77 points. This emphasises the commitment of the Fund to its CSR targets. Currently, 96% of its offices have a Green Label.
  • The Fund welcomed a new investor and an existing investor increased their commitment.

ASR Dutch Prime Retail Fund

  • ASR DPRF realised a stable portfolio value and direct return. Positive revaluations were offset by Hudson’s Bay revaluations. The Fund’s total return stood at 4.6% in 2019.
  • Occupancy rates improved to almost 99% (98.7% as at 31 December 2019) as a result of continued active asset management and a high-quality portfolio. 
  • Acquisitions, consisting of 14 high street retail assets (in Amsterdam, Eindhoven, Maastricht, The Hague and Utrecht) amounted to €113.7m, while the sale of nine non-core assets (sales result of €17.5m) resulted in the Fund narrowing its focus onto the best-performing retail assets.
  • In addition, the Fund’s investments in Amsterdam, Amstelveen and The Hague were finalised and €62m of CAPEX was invested in the Fund’s portfolio in 2019.
  • The GRESB score improved from 72 to 76 points, emphasising the commitment of the Fund to its CSR targets. In addition, around 2,000 solar panels are to be installed.
  • The Fund welcomed one investor and one existing investor increased their stake, resulting in €50m in closings in 2019.

ASR Dutch Science Park Fund

  • ASR DSPF was launched in Q1 2019 with a €200 million commitment from Fund Sponsor a.s.r.
  • In Q1 2019, the Fund signed a dedicated partnership agreement with Delft University of Technology for all commercial real estate on the whole TU Delft Campus.
  • The Fund acquired two standing investments, began construction work on two forward-funded deals and committed to a fifth asset, leading to a total of €85 million in two science parks in the Netherlands.
  • Acquisitions in this sector provide exceptional risk/return profiles; for example, the Fund forward-funded a new lab facility for research company TNO, which signed a 25-year triple net leasing contract.

For more information on the a.s.r. real estate funds, please contact Luc Joosten.

Luc Joosten
head of Fund Management
a.s.r. real estate
M: +31 (0)6 83 64 81 85
E: luc.joosten@asr.nl