Greykite has officially moved into the German residential market with the launch of its new platform, Baunest. The debut follows the acquisition of a 1,600-unit portfolio across Western Germany, including key areas such as Dortmund, Frankfurt and Greater Dusseldorf.

The investment is a joint venture with Arax Properties, which will act as the operating partner for the new brand. Baunest is set to deploy over €500 million into the sector over the next 12 to 18 months. This initial purchase involves 134 separate assets totalling 110,000 sqm. Currently, the portfolio maintains a 98% occupancy rate, offering a stable income for the Greykite European Real Estate Fund I.

The strategy for Baunest focuses on providing high-quality rental homes while ensuring they remain affordable for tenants. A major part of the plan involves a modernisation programme aimed at improving energy efficiency. These upgrades will include better insulation, new windows, and façade work to boost the Environmental Performance Certificate (EPC) ratings of the properties.

Greykite’s decision to enter this market is based on the current housing shortage in Germany. Experts suggest the country lacks roughly 200,000 units per year due to rising urbanisation. With many existing buildings requiring energy upgrades, the firm sees a clear chance to create value through capital investment.

This move represents the ninth investment theme for the Fund, which has now been involved in over $3.5 billion of transactions. Its diverse portfolio already includes data centres, UK single-family rentals and Spanish care homes.

“This acquisition marks a compelling entry point for Baunest and reflects our conviction in the resilience and long-term fundamentals of the German residential sector,” said Michael Abel, Founder and CEO of Greykite. “Structural demand, favourable affordability and improving market conditions continue to create attractive opportunities for institutional capital. Baunest comes into the portfolio as an exciting ninth investment theme for the Fund, complementing our existing collection of differentiated investment platforms across the European industrial, living and digital sectors.”

Dan Valenzano, Senior Partner at Greykite, added: “We are pleased to be launching Baunest with the acquisition of this high-quality portfolio in key Western German markets. In addition to the diversified exposure and robust income profile, this portfolio presents a number of clear and actionable value-creation opportunities that we look forward to unlocking together with our partner Arax.”