Genesta Accepted as Alternative Investment Fund Manager (AIFM) by the Luxembourg CSSF
Genesta is the first Nordic focused real estate fund manager to be accepted for its AIFM. As an AIFM in the real estate sector, Genesta will be able to raise equity in all European countries and manage non-listed real estate funds.
Genesta’s management company in Luxembourg submitted the application in mid-October 2013. “We wanted to start the process early so we could meet the deadline of July 22, 2014. But we also wanted to wait until the regulator and the advisors understood what was required to obtain the AIFMD passport” says John Jones, fund Conducting Officer at Genesta Nordic Capital Fund Management.
Genesta was advised by Arendt & Medernach and EY in developing new internal procedures and processes which directs how the company conducts its business in areas such as acquisitions and disposals, financial and risk management as well as how we lease and develop our properties.
These new ways of working are very important and not just for the AIFM designation. We identified early in the process that our institutional investors require the expanded risk management, conflict of interest and compliance processes that are mandated under the AIFM directive- David Neil, CEO at Genesta
As an AIFM, Genesta will be able to raise funds across the European Union. The AIFMD passport unifies the regulatory framework for all the European financial regulators for fund raising. “With Genesta’s second fund planned to close just after summer, the AIFMD passport is essential” says Anders Palmgren, director in charge of investor relations.
The financial crisis has resulted in demands for greater capitalization and regulation of the financial sector including greater demands for risk management, reporting and transparency. Part of Europe’s new regulatory structure is the Alternative Investment Fund Manager Directive (AIFMD), which requires regulation of previously unregulated alternative unlisted fund structures such as real estate, private equity and hedge funds.
In general, after 22 July this year, Fund Managers are no longer permitted to access capital in an alternate fund (real estate, private equity or hedge) without being licensed in accordance with AIMFD.