Real Estate Funds
Many investors first become aware of real estate funds through their bank. For the most part, these funds have not generated the promised rates of return.
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The most well-known real estate funds are:
- Allianz Flexi Immo
- ATLANTIC Immobilienfonds
- Axa Immoselect Immobilienfonds
- Axa Immosolutions
- CS Euroreal
- CFB Immobilienfonds
- db ImmoFlex
- DCM Immobilienfonds
- Degi Europa Fonds Immobilienfonds
- Degi Global Business
- Degi International
- Deutsche S&K Sachwerte GmbH & Co. KG und Deutsche S&K Sachwerte Nr. 2
- DJE Real Estate
- DWS Immoflex Vermögensmandat
- Euro Grundinvest AG
- Falk Fonds
- Görlich Fonds
- HSSB Vermögensbildungsfonds AMI
- IVG Immobilien AG Immobilienfonds
- KanAm grundinvest Fonds
- KanAm US grundinvest Fonds
- Kick Back
- Medico Fonds
- MPC-Immobilienfonds
- Morgan Stanley P2 Value-Fonds
- Premium Management Immobilien
- RP Global Real Estate Fonds
- SEB Global Property
- SEB Immoinvest
- SEB ImmoPortfolio Target Return Fund
- SHB-Fonds
- S&K Investment GmbH & Co. KG und die S&K Investment Plan GmbH & Co. KG
- S&K Real Estate Value Added
- TMW Immobilien Weltfonds
- UBS Euroinvest
- UBS 3 Sector Real Estate Europe
- Uniimmo Global
- Wölbern Invest
BGH Ruling from April 29, 2014: Damages for Failure to Disclose Possibility of Closure
In a judgment from April 29, 2014, Germany’s Federal Supreme Court – the Bundesgerichtshof (“BGH” for short) – held that banks are obliged to pay damages for failing in the course of consulting on open-ended real estate funds to disclose that the funds may be closed temporarily, meaning investors will not be able to access their money (Az. XI ZR 477/12 i.a.). This obligation to give proper advice also applies to agreements that were concluded prior to the 2008 financial crisis.
These kinds of investment funds were often tied to kickbacks, a fact that many investors were not made aware of. The BGH has ruled that in many of these cases there was an assumption that the clients would not have invested in the funds if reference had been made to the conflict of interest. If there are doubts as to whether your bank provided you with sufficient information, you should seek legal advice from an attorney. You may be entitled to compensation.
A lot of investors invested in real estate funds as partners – typically of a type of German partnership constituted under civil law referred to as a Gesellschaft bürgerlichen Rechts (GbR) or a limited commercial partnership known as a Kommanditgesellschaft (KG). The partners of a GbR are generally liable with their personal assets. Moreover, investors may be asked to make additional contributions at a later date. This can also happen in connection with a KG if distributions were made to the investors up front. Caution is also advised if consent for restructuring a fund is required, especially if the plans are not being negotiated at the initiative of the partners themselves but by the fund managers or “neutral” restructuring consultants with the banks. Restructuring agreements of this kind are often wholly inadequate.
If you have invested in a real estate fund and doubts are now emerging about how safe of an investment it really is, then you ought to obtain comprehensive legal advice from an attorney who practices in the fields of banking and capital markets law. The same applies to those who have already been asked to make additional contributions and are not sure whether they are obliged to do so.
