Shock for investors: d.i.i. Real estate funds insolvent – ​​act now!

Shock for investors: d.i.i. Real estate funds insolvent – ​​act now!

The d.i.i. Investment GmbH, a company that was known for real estate funds, has been in bankruptcy since spring 2024. This development affects a total of 16 funds with an impressive total volume of over 600 million euros. Investors who have invested in real estate are severely affected by this situation. The Deutsche Invest Immobilien Group, viewed as a reputable provider of residential real estate investments, is now faced with considerable economic challenges.

The insolvency was announced by the Federal Financial Supervisory Authority (BaFin) after a moratorium on d.i.i. was imposed on April 15, 2024. Investment GmbH was announced in order to secure the company's assets until the district court's decision on the insolvency application. The insolvency application itself is based on the insolvency of d.i.i. Investment GmbH, whereby d.i.i. Deutsche Invest Immobilien AG, which acts as the sole shareholder, filed for insolvency with the Frankfurt am Main district court on April 2, 2024. This AG is not subject to supervision by BaFin.

Affected funds and investor interests

The funds affected include, among others, the products d.i.i. Residential properties Germany 1–4, d.i.i. 17. Closed Real Estate Investment GmbH & Co. KG and d.i.i. Residential real estate Core Plus 1. The situation looks bleak for numerous private investors who have invested 10,000 euros or more. The funds were sold through various channels such as banks and independent financial intermediaries as well as online platforms. Investigations have revealed deficiencies in the information regarding risks, particularly illiquidity and possible total loss.

An example from an affected person makes the drama of the situation clear: A client invested 80,000 euros in the d.i.i. fund. Core Plus 1, however, did not receive sufficient advice and information about the existing risks. In this context, relevant claims for damages must be examined, ranging from advisor liability to prospectus liability. Investors should know that not every real estate property is necessarily affected by the bankruptcy process and that selling fund shares is practically impossible.

Legal framework and options for action

The moratorium imposed on BaFin in accordance with Section 42 of the Capital Investment Code (KAGB) allows the d.i.i. Investment GmbH is only limited to carrying out transactions for its funds. The company must obtain the consent of the depository until the insolvency proceedings are opened or the insolvency application is rejected. Investors affected should urgently have their claims assessed in order to minimize or reverse any potential losses. The statute of limitations for claims for damages also plays a crucial role, which often expires after just three years from the date of knowledge.

For investors who have questions about the current situation, BaFin offers a consumer hotline on 0800 2 100 500. It remains to be seen how the situation will develop for investors and what steps will be taken to assert their claims.