Warburg-Henderson, Henderson Global Investors' Hamburg-based joint venture partnership, has launched its second Austrian property fund which will focus on investment in a diversified portfolio of 10 to 15 commercial property assets in the core/core-plus segment. It will target a 7% yield.

Warburg-Henderson said German and Austrian investors have already committed 'a high double-digit figure of millions of euros' for the fund which is open for further institutional investors. 'The cycle is ripe for investment in Austria. It is therefore extremely important that we were able to convince investors now of the fund in order to be able to seize on lucrative opportunities,' said managing director and head of portfolio management Eitel Coridaß.

Demand is also being driven by recent legislative changes in Austria under which German tax-exempt pension and insurance schemes will also be exempted from tax on property earnings in Austria.

The Warburg-Henderson Österreich Fonds Nr. 2 has already bought its first asset, a 4,700 m2 retail warehouse in Vienna, from an undisclosed seller.

'Prices in Austria are still affordable, especially in the retail sector,' said Coridaß. 'We are planning more purchases before the window of opportunity for investment closes.' Warburg-Henderson expects rising rents this year and significant price increases in 2012.