MUNICH — June 2025 — Schroders, the London-based global asset manager, announced the closure of its Munich office at Maximilianstraße 31 after losing a key real estate mandate from Bayerische Versorgungskammer (BVK), Germany’s largest pension fund. The move highlights significant changes in Schroders’ German and European real estate strategy.
Strategic Exit from Maximilianstraße
The Munich office had been Schroders Capital’s main base for German real estate investments, managing around €800 million in assets for BVK. Following BVK’s decision to end its mandate, Schroders concluded it no longer made sense to maintain the office, opting instead to consolidate operations.
Staff Redeployment and German Market Commitment
Schroders has not disclosed the number of employees affected by the closure but said that staff would be offered opportunities to transfer to offices in Frankfurt and Zurich. The company emphasized its continued commitment to the German market, albeit with a leaner structure. This move reflects a broader trend among global asset managers to optimize resources and focus on more profitable hubs amid shifting client demands and evolving market dynamics.
Real Estate Investment Trends and Market Challenges
The closure reflects a broader shift among German institutional investors, including BVK, as they reassess real estate exposure in light of market uncertainty, rising interest rates, and regulatory changes. Many are moving towards in-house management or alternative investments. Industry experts have noted that German pension funds and insurance companies are increasingly focusing on core investments that promise stable long-term returns. This shift is compounded by economic volatility, particularly in the office sector, where higher vacancy rates and changing workplace needs have led to reduced demand for traditional office space.
Schroders’ Response and Broader Industry Impact
Schroders’ decision to consolidate in Frankfurt aligns with industry-wide consolidation efforts seen across Europe. Competitors such as Legal & General recently merged key business units and announced job cuts to streamline operations and focus on core markets. Meanwhile, asset managers like BlackRock and UBS have also adjusted their European real estate strategies to address shifting client expectations and tighter regulatory frameworks.
The German market, which had long been considered a safe haven for real estate investment, is facing challenges from higher financing costs and uncertain valuation trends. Investors are closely monitoring the European Central Bank’s interest rate policies and potential impacts on asset yields. Additionally, environmental, social, and governance (ESG) considerations are playing a growing role in investment decisions, with clients demanding sustainable real estate solutions.
Market Outlook
While certain segments such as logistics, industrial, and student housing remain attractive to investors, offices and healthcare real estate have come under pressure. Rising construction costs, stricter regulations, and the need for energy-efficient upgrades are reshaping investment strategies. Schroders’ consolidation in Frankfurt is seen as a strategic move to concentrate resources where demand remains more stable and to provide better client service in key regional hubs.
Conclusion
The closure of Schroders’ Munich office demonstrates the challenges asset managers face in today’s dynamic investment environment. As key clients restructure and reallocate investments, firms like Schroders must adapt their strategies and operational footprints to remain competitive. The decision to close the Munich office reflects the firm’s broader focus on efficiency, profitability, and long-term growth amid evolving client needs and regulatory pressures.
Key Takeaways
- Schroders closed its Munich office after losing a €800 million BVK mandate.
- Staff are being redeployed to Frankfurt and Zurich.
- The move reflects broader industry trends toward efficiency, mandate concentration, and strategic realignment.
- Legal & General and other asset managers are also restructuring to adapt to market pressures.
- Rising interest rates, ESG demands, and shifting investor priorities are reshaping the German and European real estate investment landscape.
