JV sets up €500m platform to target Shari’ah-compliant assets in Europe

A joint venture between the Capital Bay Group and Gulf Islamic Investments (GII) is setting up a platform for Shari’ah-compliant investments in retirement homes in Europe, targeting assets with a core-plus and value-add focus. The platform, regulated in Luxembourg, launched in September with an initial €500 million offering focused on real estate investments in income-producing properties located initially in Germany and then potentially expanding to other countries in Continental Europe. “The development of attractive investment opportunities in the European senior living real estate market enables our MENA-based investors to participate in this highly desirable asset class which would otherwise be difficult to access from the region,” said Mohammed Alhassan, founding partner and co-CEO of GII.

The joint venture was established to maximise cross-border synergies, the two groups said, joining GII’s capabilities with the knowledge and experience of Capital Bay, a company that has been at the forefront of healthcare real estate in Europe. “With our platform and network we are delighted to offer GII, a successful and experienced global investor, the opportunity to enter and participate in this fast-growing market segment and create the urgently-needed supply for this segment,” said Rolf Engel, group CFO of Capital Bay Group, and CEO of Capital Bay Fund Management.

The expectation is that a growing senior population in Germany and Western Europe will lead to increased demand for all forms of senior living, assisted living, healthcare and specialised clinics for elderly people. According to Engel the German healthcare market, with its extensive fragmentation of more than 2,000 operators, predominantly managed by
private investors running two or three nursing homes on decentralised sites, represents a particular barrier to entry. Hence the need for a foreign investors to team up with a local specialist. “Our tailor made platform allows us to act
locally for our society and community by joining hands with established international capital,” said George Salden, CEO of Capital Bay Group. “We truly believe that this offering will deliver superior risk-adjusted returns to investors around the globe.” The platform has a long-term outlook and will focus predominantly on manage-to-core and upgrade-to-core investments.