Corestate Capital has raised almost €486m (£385m) of equity for its €2bn (£1.58bn) German residential fund.

The Zurich based private equity investor and asset manager announced this morning that it had raised the money from an investor pool that includes ING, Morley and Goodman.

The fund invests directly and indirectly in German residential real estate and is approximately 50% invested. It will run until 2014.

Corestate said the equity raise demonstrates the continual demand from large institutional investors for German residential property despite issues arising from the credit crisis.

Successful capital raise

‘Despite the subprime crisis many of our investors very quickly increased their investment allocations to the fund, facilitating our successful capital raise,’ said Corestate chairman Ralph Winter.

Winter said the fund is looking to invest €600m (£475m) by the end of the year.

He said: ‘We are continuing our tried-and-tested strategy of acquiring residential portfolios throughout Germany for between €5m-€50m (£3.9m-£39.6m) via our dedicated, local sourcing platform. This enables us to acquire assets predominantly off-market, and avoid often expensive bidding processes.’