KGAL expands European residential portfolio with Dutch deal

KGAL's European residential fund, Core 5, has bolstered its holdings with a newly built, fully occupied apartment building in The Hague, Netherlands.

Apartment building in The Hague

The building, spanning 3,000 m2 and finished in 2024, comprises 36 high-quality, efficiently designed apartments averaging 83 m2 each, along with 29 parking spaces. 
This acquisition addresses the strong demand for rental housing in The Hague, and the building boasts top-tier sustainability and efficiency features.
Rainer Pohl, head of Transaction Management at KGAL, said: “Despite a challenging market environment, we were able to acquire a fully let core property without any development or letting risks. Against the backdrop of structurally limited new construction activity in many European metropolitan regions, stable excess demand and attractive gross initial yields, we continue to see good investment opportunities in the residential segment, which is in demand from investors. Further selective investments are therefore planned for Core 5. Specifically, we are looking for younger portfolio properties with high ESG performance in liquid, high-growth markets to further optimise performance and diversify risk."
Philipp Langbehn, portfolio manager of KGAL Core 5, added: “With the purchase of this ESG-compliant portfolio property in an economically and demographically dynamic residential market, we are consistently pursuing our pan-European investment and growth strategy. With its attractive yield profile, the property is an ideal building block for our long-term residential property fund, whose attractiveness is further strengthened by the ongoing geographical diversification and the convincing performance since its launch.”
Legal and tax due diligence was conducted by Dirkzwager, while DW Real Estate's Dutch branch handled the commercial due diligence. Technical and ESG due diligence were performed by SGS and Oterea, respectively.
This Dutch property marks the fund's third investment, following acquisitions in Ireland and Spain, pushing its invested equity past €100 mln, a key strategic milestone. Maintaining its focus on sustainability, all fund properties are fully compliant with Article 9 SFDR. With a high occupancy rate of approximately 97%, the fund is currently delivering high single-digit percentage returns on a 100% equity basis.