Return to search

Bouwfonds’ new fund targets €100bn German digital market

The Dutch firm’s successor to its €300m Netherlands-focused vehicle will invest predominantly in fibre optic networks in Germany as it reaches a €100m first close.

The Netherlands-headquartered investment firm Bouwfonds Investment Management has reached a €100 million first close for its new €300 million communications infrastructure fund following contributions from German pension funds and insurance companies.

The Bouwfonds Communication Infrastructure Fund II is aiming to invest between €500 million and €600 million in telecoms infrastructure in Germany as it seeks to catalyse the funding of the country’s “urgently needed network expansion”.

The fund expects to deliver a yield of between 5.5 and 6.5 percent, with minimum investments set at €10 million. The bulk of the vehicle’s investments are expected to be in fibre optic networks while a smaller share has been reserved for investments in communication towers and data centres. The firm said it anticipates to close a first deal shortly.

While Bouwfonds has been working on the launch of the fund for more than two years, the first close has arrived six weeks after the German government revealed plans for public and private sector investment in digital infrastructure totalling €100 billion through to 2025. The government’s finance will be accompanied by investments from the country’s private network operators while plans are also in place to attract further institutional capital as it seeks to meet EU targets of nationwide internet speeds of 1 gigabit per second by 2025.

“Meeting this demand will become increasingly important for national economies,” said Martin Eberhardt, Bouwfonds’ country manager for Germany. “However, this requires substantial upgrading of telecom and cable networks.”

BCIF II will act as a successor to the company’s first telecoms fund which was launched in 2008 and is focused purely on investments in the Netherlands. Bouwfonds manages assets worth about €800 million from the fund, which attracted capital from some of the largest Dutch pension funds.