With nearly €2.2 billion* in fundraising, La Française Global REIM has exceeded its 2017 objectives
12 December 2017
With the development of its European real estate platform, La Française Global REIM raised nearly €2.2 billion in 2017, bringing its total real estate assets under management to close to €16 billion.
2017 marked the start of a new positioning for La Française, which was awarded three sites as part of the request for proposals for “Investons la Métropole du Grand Paris”. La Française is now enhancing its core business activity as a specialist in investment and third-party management. It is adopting an investment approach aimed at creating value around infrastructure projects associated with the Grand Paris project by purchasing greenfield and brownfield development sites.
1/ 2017 Fundraising
In the current environment of stable interest rates and stronger growth, real estate offers a genuine opportunity for diversification to investors seeking higher potential returns.
Institutional: La Française pursued its real estate development strategy in France and internationally among institutional clients and has raised close to €1.2 billion in funds.
The internationalisation in market trends seen in 2016 continued: Asian clients seeking diversification dominate, representing more than 16% of funds raised. Total European assets under management for Asian institutional investors represent close to €900 million. Through its international real estate platform with management centres in Paris, Frankfurt and London, La Française can offer investors, looking to access the main European markets, diversified investment solutions, by geographical region, strategy and theme, in a variety of forms (open-ended funds, dedicated funds, mandates and club deals).
In 2017, La Française closed its largest single transaction to date, a new co-investment on behalf of two leading Korean institutional investors. It concerned “North Light & Pole Star” in Brussels and is a perfect illustration of La Francaise’s capacity to source quality assets and meet the needs of investors seeking both diversification and potential returns.
With €1 billion in fund raising through mandates in 2017, La Francaise has demonstrated the relevance of its tailored-made investment solutions.
Retail: La Française continued to register growth among retail investors. Fundraising increased by 25% in 2017, reaching close to €1billion:
- Like the overall collective real estate investment market, which saw record inflows in the first half of 2017, La Française raised close to €800 million in 2017 across its range of collective real estate investment vehicles. Fundraising activity especially targeted those vehicles invested in the major European markets: Germany notably, because of the investment potential and attractive tax framework.
- Fundraising of close to €200 million on unit-linked insurance products, reflecting continued growth in 2017.
In addition to finalising a development project initiated more than three years ago (IPSO FACTO in Montrouge, southern Paris), 2017 saw high activity levels with nearly €2.8 billion in transactions, of which €2.3 billion in investments and more than €400 million in arbitrage operations. Hereafter the breakdown of acquisitions by asset type: 68% for office buildings, 13% for retail premises and 19% for other assets, including managed residences (facilities for seniors and tourism), activities, residential and diversification assets.
In France, La Française confirmed its position as a major real estate player with €1.6 billion in acquisitions, the most notable of which are: a retail asset in Paris (19e), “Le Hub” office building in Levallois Perret (92), “Cityscope” in Montreuil (93), a holiday residence in Cavalaire-sur-Mer (83), etc.
Growth in acquisitions in the rest of Europe continued, with nearly €700 million in new acquisitions. The group's collective real estate investment vehicles invested notably in Frankfurt, Stuttgart, Hamburg, Berlin and for the first time in Ireland.
“Our real estate activity is overseen by a team of 140 people, 120 of whom are in France, 15 in Frankfurt and 5 in the UK. Thanks to the synergies created with all of our teams we have been able to meet our growth targets and are in a position to successfully navigate through this intense phase of investment diversification,” says Marc Bertrand, CEO of La Française Real Estate Managers.
“La Française is a major real estate investment player. The development of metropolitan areas, such as the Grand Paris region, creates opportunities for international investors. The manner in which public authorities proceeded, by sending out a request for proposals, also required a new organisation from us; instead of developing or acquiring individual assets, we are building entire “green” districts. In this manner, La Française can position itself well upstream via its land development activities,” stresses Xavier Lépine, Chairman of La Française.
*Forecast based on inflows already recorded at 30/11/2017, data not definitive.