Stone2Cap, a new AIF focused on the luxembourgish real estate market

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June 15, 2023

The fund aims to provide long-term value to its investors and benefits from a highly experienced team and the current market conditions. A conservative fund, the objective is to give access to a portfolio of prime pre-let real estate properties focusing on investing on key Luxembourg districts and deliver a steady cash flow through AAA rated tenants.

The fund would opportunistically invest in development sale of residential properties. With a gross target IRR of S2C of 9-11%, the aim is to maximize performance with a mix of pre-let rented office properties and development sale of residential properties with an average holding period of 6 years. Tom Wagner, Founder of Towa Invest and Managing Partner of Wagner Management, said, "We are excited to launch Stone2Cap, which aims to generate above average income and maximize mid-term capital appreciation by investing in real estate projects in Luxembourg. Being Wagner Management the Investment Advisor allows Stone2Cap to leverage on a substantial successful track record of Wagner Group as well as benefit from an experienced team within the group. Furthermore, we have partnered with reputable firms like Edmond de Rothschild Asset Management (Luxembourg) as AIFM, Savills for valuation, Mazars as auditor and DSM as legal advisors. » Wagner continue adding “Luxembourg is a strong market where in the office space, the share of pre-letting is however higher than last year at 38% vs. 25% in the corresponding period of 2021. The average transaction size significantly retreated in H1 2022 to 848 sq.m. vs. 2,387 sq.m. a year ago.

At this particular moment of raising yields due to the interest rate environment, the fund will benefit from a yield contraction in five to ten years. On an opportunistic basis, the Fund will benefit of entering in the development of residential properties under the current environment of price adjustment”. The Fund has a target of raising one hundred million euros with institutional investors with minimum investment commitments of 3 million euros.  Tom Wagner add that “the Wagner Group will commit up to 10% of the total fund commitment”. Only Well informed on professional investors will be able however to invest in S2C through a feeder vehicle promoted by Antwort from 150 thousand euros commitment.

Manuel San Salvador, Antwort’ s Founder and Managing Partner said, “with a proven track record of generating optimal risk and reward ratio, the Wagner Group has consistently delivered risk adjusted returns, backed by authorized projects and sale potential”. San Salvador add that “this is a very good moment to invest in real estate in Luxembourg, as of today the office yields according to recent market studies are increasing from 3.25% in Luxembourg, applicable to the CBD and the Kirchberg districts. A slight premium is attached to the other central districts Cloche d’Or and the Station. A wider premium is priced for City Belt, Belval and Periphery locations. We agree that yield contraction in a five to ten years period back to historical recent past yields”. And finalized “I do not see a better way to get exposure to the strong real estate market in Luxembourg under the current environment from 150.000 euros commitments”.

About TOWA Invest and Wagner Management TOWA Invest is a private Luxembourg-based company focused on investing in high-quality opportunities. Wagner Management is a Luxembourg-based real estate management company. About AntwortAntwort is a Luxembourg based company and expert in alternative funds. Antwort identifies attractive private equity, private debt and real estate funds as regards to the investment theme, track record and GP expertise and after a strong selection process, give access to those funds through Antwort’s feeder fund platform to well informed investor from commitments of 150.000 euros.