Japanese investors committed $1 billion to Deutsche Bank for a new infrastructure fund, as its money management unit sought to provide clients with access to bigger returns and reverse an outflow of capital.
Deutsche Bank’s RREEF division in Chicago will invest the cash from the DWS Global Infrastructure Equity fund in stocks, while its headquarters in Frankfurt handles associated derivatives, according to a memo sent to employees last week and obtained by Bloomberg News.
“We were able to offer an interesting opportunity to return-hungry Japanese investors,” Asoka Woehrmann, co-chief investment officer at the bank’s money management unit, said in the memo. “The fund’s main goal is to guarantee an attractive and relatively stable income source that also offers the chance to book capital profits.”
Deutsche Bank, Europe’s biggest bank by assets, is among companies investing more of their clients’ money in construction after the European Central Bank eased monetary policy and returns from some bonds turned negative, when including the impact of inflation. Allianz SE, Europe’s biggest insurer, wants to grow “over-proportionally” in real estate and infrastructure, Maximilian Zimmerer, a member of its management board, said last month.
Deutsche Bank is seeing an increase in demand for real estate and infrastructure investments and DWS Global Infrastructure Equity is part of an investment program started for a client in Japan on Oct. 24, according to the memo. The fund managed $1.01 billion as of Nov. 19, it said.