M&G Real Estate fund makes first German senior living investment

M&G Real Estate's €578 mln European Living Property Fund has made its first German senior living investment, acquiring an €82.5 mln development in Erftstadt. 

Erfstadt

The fund, launched in 2023, targets various European residential sectors, including student housing, single/multi-family housing, and retirement living. 
The 17,826 m2 Erftstadt property, featuring 163 self-catering apartments and some care units, will be leased to Schönes Leben Group, a rapidly expanding German senior living provider, for 25 years. 
This high-sustainability building offers premium amenities in a rural setting near Cologne and Bonn, attracting residents from the Rhineland Metropolitan, Greater North Rhine Westphalia regions, and the Frankfurt area.
Marcus Eilers, head of European Residential at M&G Real Estate, said: “This is the M&G European Living Property Fund’s second acquisition in Germany and its first investment in a high-calibre senior residential property with strong sustainability credentials. The significant growing demand for high-end senior living accommodation, coupled with the defensive nature of healthcare real estate, makes this an attractive asset class for institutional investors.”
Thomas Kächele, head of Germany and Central Eastern Europe at M&G Real Estate commented: “As demand for residential accommodation accelerates across Europe, we are looking to increase our investments, especially in Germany, where senior living has become mainstream within institutional portfolios. With only 30 homes per 1000 people over the age of 70, Germany’s senior housing market can unlock strong growth potential for investors.”
Kip Sloane, managing director Schönes Leben Group, added: “M&G Real Estate's investment is a strong signal for the Schönes Leben Group and underlines the value and future viability of the premium senior living segment in Germany. We are very pleased working with M&G and to have signed a pioneering green lease. This shows that the premium senior living asset class can be marketed internationally as a residentially rated project.”