France’s biggest social landlord CDC Habitat announced on Thursday that it has raised over €1.25 bn at the final close of its second intermediate housing fund, FLI2.
The fund, which was oversubscribed, initially launched last December and is backed by both long-standing and new partners, including foreign institutional investors.
According to CDC Habitat, a unit of the French Caisse des Dépôts, the fundraising is the largest in the European residential sector over the last three years and gives the fund a total spending power of €2 bn which will be deployed in the construction of 11,000 housing units in Grand Paris and in major French cities.
Intermediate housing will account for 80% of the portfolio while student and senior residences will make up for the rest. The vehicle - which has yet to make its first investment - will seek to generate gross yields around 4%, or 3% net, the same level as for FLI1, according to a company spokesperson.
'With this fundraising, we hold a privileged position to invest in new housing in the Grand Paris area,' said Vincent Mahé, CEO of CDC Habitat's Ampere Gestion unit and Corporate Secretary of CDC Habitat. 'Such a result demonstrates that intermediate housing has emerged as a new asset class targeted by institutional investors in their asset allocation strategy.'
FLI2 held an initial close in January raising €900 mln from 15 investors, half of whom had already invested in FLI 1.
FLI 1 launched in 2014 with an investment capacity of €1.7 bn and is now fully invested.