(Bloomberg) -- Credit Suisse Group AG has become the latest lender to bet on Europe’s booming rental housing sector.

The Swiss bank’s asset management arm is teaming up with real estate investor MARK to acquire and manage residential properties in city centers, according to a statement Tuesday. The DOMA venture seeks to raise an initial 350 million euros ($414 million), said a person familiar with the matter, who asked not to be identified because the funding details are private.

The partnership will first target a portfolio of single homes and small apartments across Germany and the Netherlands, where it already manages about 700 homes, according to the statement. DOMA eventually aims to build a Europe-wide portfolio worth around 1 billion euros.

“Residential for rent has demonstrated its resilience throughout the pandemic,” said Josip Kardun, MARK’s chief investment officer, who also heads DOMA. “There is a major untapped opportunity in privately-owned smaller residential assets in prime urban locations.”

Institutional investors are cashing in on a chronic housing shortage across Europe that’s boosting demand for rental housing among young people and families. Lloyds Banking Group Plc plans to become one of the largest private residential landlords in the U.K., while Australian bank Macquarie Group Ltd. is planning to invest more than 1 billion pounds ($1.4 billion) into rental housing there. 

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