Greenman OPEN – Providing Consistent Returns in times of Chaos

Greenman OPEN (GMO) is an open-ended, income producing real estate fund, established in 2014. The fund targets to deliver c. 5.5% annual returns with c.8.0% total annualised return* from stable, long-term rental income delivered by Germany’s leading food retailers. At the end of March, GMO has €750m assets under management, an annual rental income of €41m and is the largest, German food-retail focused, real estate investment fund on the market.

Roddy O’Connor & Peter O’Reilly of Greenman with Jim, Ross & Trish (taken pre Covid 19)

Impact of Covid-19

In March, food retailers across the globe were forced to respond to unprecedented demand. German food retailers continued to operate at maximum capacity throughout lockdown, recording 24% increases in turnover in March compared to the previous year.

Food Retail

The German grocery market is Europe’s largest at c.€259bn in 2019 and is growing at a rate of c.3% pa. The grocery market’s key characteristics are consolidation, strong competition and low prices. 

 

 

GMO is anchored by market leading, highly creditworthy, German food retailers. GMO’s top 4 tenants (EDEKA, Kaufland, REWE and Aldi) are amongst the top 5 EU food retailers and together those 4 tenants account for 74% of Germany’s total grocery sales. 

Fund Performance

GMO’s focus as an income fund is to secure stable and long-term income streams from highly creditworthy tenants, in particular food anchor tenants. Performance during the pandemic has been largely unaffected due to 83% of the portfolio’s tenants being deemed essential or necessity retailers with over 67% of rental income coming from food retailers. During the lockdown period GMO collected 86% of rental income for April and is estimating that it will collect 95% of rents for May.

GMO at a Glance

Gross Portfolio Value €750m
No. of Assets 69
Annual Rental Income* €41m
Main Anchor Tenant EDEKA
Rent from Food Tenants c. 67%
WARLT 8.3 years
Target Returns c. 5.5% annual distribution and c.8.0% total annualised return**

 

 

* includes some centres which have been acquired but are not yet operational. GMO classifies a centre as “acquired” when a notarised purchase contract has been executed. The centre will be “operational” and GMO will start collecting rents when completion has occurred. 

** Assuming investment term of 5 years.

All investments are subject to risk, including the loss of the principal amount invested. Past performance is no guarantee of future returns. The value of shares and the income from them is not guaranteed and can fall as well as rise due to stock and currency movements. When you sell your investment, you may get back less than you originally invested.

Greenman OPEN (GMO) is being marketed by Greenman. Greenman is authorised as an Alternative Investment Fund Manager by the Central Bank of Ireland (the Central Bank) under the European Union (Alternative Investment Fund Managers) Regulations 2013. Authorisation number C123941. Investors are recommended to seek their own independent legal, financial, tax, accounting and investment advice. Neither the receipt of this document, nor any information contained therein or supplied with this document or subsequently communicated to any person in connection with this document either constitutes, or is to be taken as constituting, the giving of financial, tax, accounting, legal or investment advice by the Company.

This article is provided for information purposes only and is not intended to be and must not alone be taken as the basis for an investment decision. By accepting this Presentation, investors are not to construe the contents of this article or any prior or subsequent communications from the Company, its Service Providers or any of their respective officers, members, employees, representatives or agents as investment, legal, accounting, regulatory or tax advice.

Certain statements contained in this Presentation are forward-looking statements. These forward-looking statements are based on current expectations, estimates, assumptions and projections about the markets, in which GMO shall operate, and the beliefs and assumptions the Company. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Among the factors that could cause actual results to differ materially are the general economic climate, inflationary trends, interest rate levels, the availability of financing, tenant strength, changes in tax and corporate regulations and other risks associated with the ownership and acquisition of commercial real estate, changes in the legal or regulatory environment or that the operation of GMO may be greater than anticipated.

In order to qualify for investment in GMO, the investor, or, as appropriate, the legal entity which they represent, needs to qualify as an Institutional Investor, Professional Investor or Well-informed Investor within the meaning of article 2 of the 2007 Act.

For more information contact one of our team call us on 01 4972544 or email trish@hegarty.ie, ross@hegarty.ie, frank@hegarty.ie or jim@hegarty.ie