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Jeremy Beswick, EIIB: aims for running yields of 7% |
Geographical spread has been enhanced by EIIB’s Pan-European Islamic Real Estate Fund, which was established in December, and in April announced a £58.8-million ($116.6 million) investment in commercial property. The fund is the 10th-ever Shariah-compliant fund to focus on European assets, and EIIB’s fund is the only open fund available at the moment. The €200 million to €500 million fund will focus on properties in the EU, and throughout central and eastern Europe, with only France excluded because of its particular tax laws. Beswick aims to generate annual running yields of 7% over the life of the fund but expects "a greater IRR may be generated, but it is best to err on the side of caution with predictions".
So far the fund has generated interest from institutional and high-net-worth individuals who adhere to the Islamic faith. However, as investors worldwide start to understand that a Shariah-compliant fund is very similar to a conventional finance fund, it is hoped that investors from all backgrounds could be interested. The fund’s next investment will come shortly after its first closing in June and is likely to be in Hungary, Poland or the Czech Republic.