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The KGAL Group has enjoyed an outstanding fiscal year. In 2017, the independent investment and asset management company achieved a new business volume of c. €2.8 billion. This represents an increase of 47% on the previous year (2016: €1.9 billion). The assets under management increased from €21.5 billion in 2016 to €22.7 billion in the 2017 fiscal year (growth of 5.6%).
€2.8 billion of new business in 2017
We are starting our anniversary year with a record result,” emphasises Gert
Waltenbauer, CEO of KGAL GmbH & Co. KG. Founded in 1968, today the KGAL
Group is one of the leading independent European real asset investment and
asset management companies. “We are in an excellent position for 2018 and the
next 50 years ahead.” At €1.5 billion, 66% more investor equity was placed than
in the previous year (2016: €0.9 billion). Waltenbauer adds: “We continue to
achieve consistent growth.”
The KGAL Group will expand its core business this year and take steps to further
globalise its activities, through the creation of new institutional investment
products across its three assets classes: the real estate, infrastructure and
aviation asset classes. In the real estate field, institutional investors will be given
the opportunity to subscribe to investments that harness the key developing
trends in the sector and allow clients the ability to be more opportunistic in their
asset allocation. In the infrastructure asset class, KGAL is expanding its range of
activities in the renewable energy generation segment to investments in the
general energy sector.
KGAL New Frontiers: investments in new markets and products
New regions and investment topics are the focus of the newly established KGAL
New Frontiers GmbH & Co. KG. The rationale of KGAL New Frontiers is to
source, assess and analyse high-interest real asset investments across new
markets & sectors and, provided that the test phase is successful, enable them to
become available for institutional investors. The company’s initial activities
include investment in an Eastern European hydroelectric plant operator and a
joint venture with a Scandinavian state energy provider.
KGAL goes digital: online platform for retail sales
The KGAL Group is developing an online platform and investment products with
an in-house fintech team. Gert Waltenbauer: “Tangible assets are still attractive
for private clients. However, apart from a limited number of traditional closed
funds, this area offers few investment opportunities.” Bearing in mind that private
clients will increasingly purchase financial products via the internet in the future,
this niche is ripe for exploitation. Market testing of the platform is scheduled to
take place in mid-2018.
Real estate: value-added management offers more opportunities for growth
The managed investment volume in the real estate asset class remains
unchanged at c.€6.9 billion, despite planned divestitures in legacy business. The
expansion of mandates with equity commitments of more than €1.0 billion was a
contributing factor here, with successful transactions for several office and retail
properties having been concluded. The transaction volume in four European
markets was over €1.5 billion in the 2017 fiscal year. With the foundation of the
new strategic value-added management business unit in July 2017, KGAL has
been working consistently on expanding its value product chain.
Infrastructure: first close of ESPF 4 with equity of €255 million
In 2017, the KGAL Group announced the first close on its ESPF 4 fund at €255
million. Four major European institutional investors committed to this total and, in
doing so, supported the continuing global expansion of KGAL’s renewable
business. ESPF 4 is a SICAV-SIF vehicle based in Luxembourg and pursues a
core plus investment strategy for renewable energy. The second close is
expected in Q2 2018 with three more national and international investors.
Aviation: expertise wins multiple awards
The aviation asset class recorded a managed investment volume of more than €2
billion for the 2017 fiscal year (2016: €1.3 billion). The new business volume was
€1.3 billion in the same period (2016: €1.0 billion). This represents an increase of
30% on the previous year. The KGAL Group won two awards last year for its
market position, set-up and placement within the aviation asset class: the GTF
(Global Transport Finance) Award 2017 and the Scope Alternative Investment
Award 2018, both in the “Transportation” category.