Deka’s open-ended real estate funds see strong growth amid market challenges

Saving bank clients continued to invest heavily in Deka’s open-ended real estate funds throughout 2024, resulting in net sales of EUR 350 million. This positive momentum has carried over into the new year, with the first four weeks of 2025 already generating EUR 262 million in net sales, driven largely by reinvestments following distributions. Investors were drawn to the funds’ stability and consistent returns, which ranged between two and three percent, surpassing the industry average.

According to Dr. Matthias Danne, Deka Board of Management member responsible for asset management, investors in 2024 benefited from the conservative management approach, which ensured steady returns. The fund strategy focused on real estate in prime locations while avoiding project development risks, ensuring a high-quality portfolio. Danne expressed confidence that 2025 will see similar strong performance, driven by systematic cash flow management and selective investments.

Deka Immobilien recorded a total transaction volume of EUR 1.7 billion in 2024, with EUR 820 million spent on nine acquisitions and EUR 860 million generated from 22 property sales. Among the key acquisitions, two office properties in Vancouver and Sydney strengthened the fund’s international presence. These purchases reflected Deka’s ability to seize opportunities in core global markets, capitalizing on favorable purchase conditions that contribute to long-term fund stability.

Sales were not liquidity-driven but instead focused on portfolio optimization, with properties that no longer aligned with Deka’s strategy being offloaded. Danne emphasized that the firm will continue to make strategic purchases in 2025, adapting to different market conditions while maintaining strong portfolio performance.

Despite challenging economic conditions, Deka’s real estate assets increased to EUR 51 billion by the end of 2024. Retail funds recorded net sales of EUR 350 million, reinforcing the confidence of private investors. Meanwhile, institutional business saw a net sales decline of EUR 330 million, highlighting a divergence in market sentiment between retail and institutional investors. Total asset management volume for Deka Immobilien reached EUR 55.2 billion by the year’s end.

Deka expects its large, open-ended real estate funds targeting private investors to continue delivering returns between two and three percent in 2025, further strengthening its market position.

Leasing activities remained strong in 2024, with lease agreements generating a net annual rental volume of EUR 400 million. By year-end, the portfolio’s occupancy rate stood at nearly 94 percent, reflecting the resilience of the assets under management. The high occupancy rate has been a key factor in maintaining the stable performance of Deka’s funds, providing investors with consistent returns.

With solid investor demand, strategic acquisitions, and high occupancy levels, Deka Immobilien remains confident in its growth trajectory for 2025. The firm’s focus on quality assets in prime locations, combined with a disciplined investment strategy, positions it well for continued success in an evolving real estate market.