GERMANY – Former chief investment officer of the six billion euro Bayer pension fund, Juergen Bader, has set up a new firm to focus on real estate.
Bader’s new company, JB Investconcept GmbH, will focus on asset allocation and asset management advice for institutional investors as well as design and placement of real estate investments for either direct or pooled fund investments.
The decision to focus on real estate was a result of the deterioration of capital markets. Explains Bader: “With risk tolerance having almost completely vanished, stocks have gone out of favour and fixed income yields are underperforming the target returns of pension funds and other institutional investors. Within such an environment particularly real estate investments, ie those generating secure cash flow income from long lasting leases with reliable tenants, will be extremely attractive. In addition many smaller sized pension funds did not have access to real estate in the past because they could not afford diversification into real estate by buying property directly.”
Bader will concentrate on creating appropriate real estate strategies as well as using pooled fund vehicles with an investment profile of low risk sustainable returns in conjunction with leading German and international real estate developers and asset management firms.
For those investors who can afford a higher level of risk there is available a choice of genuinely innovative ‘alternative’ products, such as convertible bonds of investment grade European listed real estate companies, real estate opportunistic funds, with both issued through note structures of large German banks.
Bader was managing director and chief investment officer at the Bayer pension fund since 1989. He also chaired the supervisory board of a German real estate company, and was a member on the board of the German association of pension funds, ABA.
JB Investconcept is based in Duesseldorf.