Asset manager DMFCO has entered a partnership with Hamburg-based bank Donner & Reuschel to offer investment options in the Dutch residential mortgages market to institutional investors and pension funds in Germany and Austria.
“DMFCO has set up a fund that allows investors to deploy capital in dedicated portfolios with bespoke guidelines as well as co-investments into a fund where the guidelines are set by DMFCO as the manager,” Peter Verleun, institutional clients manager at the Dutch asset manager told IPE.
Investors can choose a “joint compartment together with other investors or a dedicated compartment, where the investor determines the investment criteria,” Georg Steinig, managing director, head of fixed income and structured capital markets at Donner & Reuschel, added.
Munt Hypotheken, a brand of DMFCO, originates the residential mortgage loans.
DMFCO’s move into Germany and Austria follows a fund raise of more than €20bn for investments in residential mortgage loans in the Dutch market.
“We see a growing interest from German and Austrian institutional investors for safe, long-term investments and therefore DMFCO has defined Germany and Austria as a core growth region,” Verleun said.
DMFCO has sounded out the German and Austrian markets to receive a “very positive” first feedback from German investors, Steinig said.
“We have already started first investor calls and meetings in Germany and we will introduce the investment to a wide range of investors over the coming weeks,” he added.
The Dutch asset manager has picked Donner & Reuschel for its structured capital markets team, with a track record in the asset class and a footprint that leads to understanding local insurance companies, pension funds and the regulatory environment.
Donner & Reuschel will exclusively market mortgage investments opportunities in the Netherlands to institutional investors in Germany and Austria.
“In light of the low yield environment, which will likely last for years, we expect Solvency II-driven and ALM focused investors to shift to assets with attractive risk return profiles such as Dutch residential mortgages,” Steinig said.