German financial services provider, Wüstenrot & Württembergische (W&W), has bought a 35% stake in real estate debt firm BF Capital, signalling various new funds and products are on the way.
Francesco Fedele, CEO, said. ‘The idea behind selling an interest in the company to W&W Asset Management is to put BF.capital on a broader basis and thereby to create a full-service provider for all relevant private debt segments.’
‘This step lets us use the corporate debt and infrastructure debt segments to enter areas that show substantial overlaps and synergies with real estate debt. In the W&W Group, we have found a powerful partner for new products. In addition, we intend to keep growing in the real estate debt segment.'
The news comes just days after listed company W&W – which was founded in 1999 - posted impressive H1 financial results showing a 24% uplift in profits to €180.7 mln.
W&W owns various businesses, including property and life insurance, residential mortgages, and a new lending division. It has around 13,000 people working as in-house staff or a mobile sales force for the Stuttgart-based firm.
Meanwhile, BF.capital revealed not only is it prepping a new direct real estate lending fund but is significantly branching out its offer to include corporate and infrastructure financing.
Up to now, BF.capital has been active exclusively in the field of real estate debt.
But with W&W’s backing, it has filed an application for a license under the German Securities Institutions Act (WpIG) that would authorise it to use fund-of-fund structures and separate accounts to make private debt solutions available to third-party investors outside the W&W Group.
In a statment, the company said it was preparing to launch various products as well as new real estate debt direct lending fund that will be 'put on the market shortly'. 'With this strategic investment, W&W Asset Management is opening up selected activities for third-party business and accessing new profit pools for the W&W Group in the area of alternative investments.'
Alexander Mayer, CFO of the W&W Group and the MD of W&W Asset Management, stated: ‘We are aware of major opportunities in the area of private debt, and look forward to being able to contribute our internal know-how to BF.capital, and thus to make it available to third parties, too, in the longer term. The BF Group is the perfect partner for us, because it is independent and neutral, and because it is part of a broad-based network, especially in the real estate sector.’
The onboarding of W&W Asset Management as new shareholder will also prompt an expansion of BF.capital’s senior management. Eugenio Sangermano and Berthold Garbas, who are both transferring from W&W Asset Management to BF.capital, will join incumbent MD, Manuel Köppel to lead BF.capital. In addition, BF.capital is setting up a supervisory board. It will be chaired by Francesco Fedele, the CEO of BF.direkt.
Fedele is to chair the newly created supervisory board.
Köppel, said: ‘We face the future with a great sense of optimism not just in the area of real estate debt but also in regard to the private debt asset class as a whole. Once the repercussions of the interest rate shock for portfolios have been addressed, which takes longer in the case of illiquid asset classes than it does with liquid instruments, investors stand to benefit from the fact that lending parameters have shifted in their favour.’