M&G Real Estate, part of M&G’s €93 billion¹ private markets business, has acquired two serviced apartment assets in Berlin and Bielefeld by way of a forward purchase, on behalf of its €5.2 billion2 European Property Fund (the Fund). The two transactions, totalling €73.5 million, mark the strategy’s first investment into the serviced apartment sector in Europe. The assets were developed by Livory, a German real estate development platform with a focus on Build-to-Rent (BTR) and serviced apartments.
Since the pandemic, demand for serviced apartments has broadened and continues to grow faster than traditional hotels, benefiting from evolving travel patterns and growing demand for flexible accommodation from an increasingly mobile workforce. The sector appeals to a diverse range of occupiers, including business travellers, project-based employees, relocating professionals and leisure guests, supporting occupancy across both short- and extended-stay formats. With supply remaining constrained in many markets, the sector is supported by favourable long-term fundamentals. Positioned at the convergence of the living and hospitality sectors, serviced apartments provide investors with access to two structurally attractive real estate themes, while long-term leases to established operators can offer inflation linked income, defensive asset characteristics, and a diversification of portfolio cashflows.
In Berlin, a newly refurbished scheme of 183 fully furnished apartments is in the sought-after Prenzlauer Berg district, offering excellent transport links. The refurbishment was completed in April, enhancing its sustainability credentials through the installation of sun blinds, heat pumps, upgrade to the cooling system and newly designed apartments and lobby. The asset has an EPC A rating and is targeting a BREEAM3 In-Use ‘Very Good’ certification.
The Bielefeld asset is a new development, featuring 221 fully furnished apartments and one commercial unit on the ground floor. Fully operational since February 2026, it is located next to the city’s main train station, with the old town and the high street within walking distance. The asset was developed to a very high energy-efficiency standard, with zero on-site fossil fuel consumption and heating delivered through a district heating network. The asset is targeting a DGNB3 “Gold” certification.
Both schemes will be leased on a 20-year term to Livory’s sister company smartments, which is an established operator in the serviced apartments sector in Germany.
With a nearly 20-year track record, the Fund continues to deploy capital with conviction, having completed or agreed over €1.6 billion of acquisitions in the last nine months across a diversified set of well-located assets in core European cities. The strategy continues to deploy capital where long‑term structural demand, supply constraints and sustainability considerations support resilient income and long‑term value creation for institutional investors globally.
Simon Ellis, Manager of the M&G European Property Fund at M&G Real Estate, commented: “This transaction marks our debut into serviced apartments – a sector which is gaining strong momentum across Europe, and particularly in Germany, supported by catch-up potential, solid performance and rising investor interest. Despite this momentum, the sector remains structurally undersupplied, offering an attractive opportunity for investors to tap into a still relatively small but expanding segment of the living and hospitality market across Europe’s key gateway cities. Both cities present compelling fundamentals, underpinned by supply demand imbalances, strong rental dynamics and solid occupancy levels, supporting the serviced apartments sector’s long term growth prospects.”
Simon Behr, Managing Director at Livory, commented: "This transaction confirms institutional demand for modern, high-performing serviced apartment products in Germany. Livory's expertise in the conception and development of assets with high-quality standards, clear ESG credentials, and prime locations were a key factor for the transaction; and lay a solid foundation for the future performance of the properties."
1 AUM as of 31 December 2025
2 GAV - as of 31 March 2026
3 Ratings should not be taken as a recommendation. Please visit https://breeam.com/about/how-breeam-works/ and https://www.dgnb.de/en/certification/important-facts-about-dgnb-certification/about-the-dgnb-system for more information.
