Amundi Real Estate

Corporate overview 

Amundi is the leading European asset manager by assets under management and ranks in the top 10 globally.¹ With 5,400 professionals based in 35 countries, it now manages more than €1,900bn of assets² across six investment hubs and €793bn of assets under responsible investment management. Headquartered in Paris, Amundi was created in 2010 and listed on the French stock exchange in 2015.

In 2016, Amundi launched Amundi Real Assets (ARA) to provide easier access to unlisted investments. Bringing together capabilities in real estate, private debt, private equity, multi-management, impact investing and infrastructure, ARA is comprised of 250 experienced professionals based in Paris, London, Milan, Madrid, Dublin, Barcelona and Luxembourg, and manages over €66bn² of assets under management and more than 1,800 assets in 16 countries across Europe. As part of ARA, Amundi Real Estate is a company specialised in developing, structuring and managing European focus property funds. With €44bn of assets under management,³ the firm ranks number eight worldwide for office real estate.⁴

With its fundraising power, Amundi has the ability to take part in Europe’s major real estate transactions. Amundi Real Estate is an authorised management company active in France, Germany, Italy, the UK, the Czech Republic, the Netherlands and Luxembourg. Drawing on 40 years of expertise, Amundi RE manages all types of investment solutions for its French and European clients: club deals, co-investments, dedicated mandates, and closed-ended or open-ended funds.

_{¹ Source :IPE ‘Top 500 asset managers’ published in June 2022 and based on AUM as of 31 December 2021.
² Amundi figures including Lyxor as of 30 June 2022.
³ Amundi figures as of 30 June 2022.
⁴ IPE Real Assets Top 150 Real Estate Fund Managers, published in Decem- ber 2021, based on data as at 30 June 2021.}

Sector forecasts

INDUSTRIAL/LOGISTICS: It is likely that the supply-chain reconfiguration and e-commerce may sustain demand in the next quarters. On the other hand, the economic slowdown might affect the industry and consumption. Market yields have significantly decreased during the last years, reinforcing the need to be selective, even if a softening is likely in the next months. The relative scarcity of supply in some very sought-after submarkets near major cities and logistics hubs can favour room for rental increase, even if one has to remain cautious on energy prices and the capacity of tenants to have such rental increases.

OFFICE: The GDP slowdown may affect occupier interest linked to growth in employment (although the employment market has so far resisted). However, occupier demand could be fuelled by some firms using their real estate to attract and retain employees, as real estate can be a criteria for people looking for a job, even if some companies change their office footprint going to flexible office workstyle (in link with remote working). We believe central locations or those near transportation hubs can have some advantages for tenants. The occupancy rate could increase, although the fragmentation between markets and submarkets should remain in the next quarters due to the current trend of firms looking for centrality and high-quality buildings. Rental growth is driven by inflation and relative scarcity in undersupplied areas (generally CBDs) whereas rent dynamics should be at least subdued in oversupplied areas. We believe the impact of indexation and likely increase in charges (due to the increase in energy prices) will have to be monitored. It is likely that many investors will look at central areas.

RESIDENTIAL: Residential saw a rebound in investors’ interest during the last years, partly linked to the demographic fundamentals of this asset class and the lack of supply in some markets. Such features should remain, even if the potential increase in the financial cost could impact the market yield.

RETAIL: Higher inflation erodes consumer purchasing power and the impact on consumption will have to be monitored. The retail market should remain fragmented between locations and asset classes, in line with consumer behav- iour. In this context the capacity of tenants to afford their rent should be moni- tored; regarding this, locations with strong flux or retail parks, which have generally lower rents, can offer some opportunities. In Europe, market yields for retail assets increased before COVID so that some investors increased their investment share in H1 2022, although remaining below pre COVID levels.

Investment principles & strategy

We designed a robust investment process in which an SRI policy is embedded at each stage: starting with a thorough analysis of European markets’ dynamics, supported by extensive asset sourcing capabilities, and followed by a stringent asset selection. Properties are then actively managed throughout the lifespan of the investment to create value and alpha. Three main principles define our investment philosophy:

1) Fund allocation driven by multi-disciplinary research: To forge its market opinions, Amundi Real Estate has developed an internal research capacity specialised in French and European real estate markets. Amundi Real Estate also benefits from Credit Agricole group’s macroeconomic and fundamental research as well as the investment strategy models produced by the Amundi group. This multi-disciplinary research contributes to suggest strategic allocations and to define return/risk profiles for existing and new funds.

2) Strong expertise in a structured investment process: Our asset management teams are structured by real estate sector, developing a very sharp specialisation in their area of activity. Clear, solid and formalised management processes and working procedures frame our management actions in order to avoid operational risk and conflicts of interest. With this management approach, thematic committees have been created to validate and agree each decision at each step of the process and favour confrontation of opinions.

3) Strict risk control: We are pragmatic and prudent in our investment decisions, and nurture a strong risk-management culture. In addition to systematic risk controls, independent internal risk managers ensure compliance with regulatory constraints and the risk limits defined by each investor and for each product.

Strategic corporate development

Amundi Real Estate has been a leading player in originating, developing and managing property assets in France and across all major European cities for 40 years. Our pan-European diversification strategy relies on local partner- ships with the best experts in each country. We are therefore able to build the local ecosystems we need for the acquisition and management of our property assets. European real estate markets are diverse enough to provide opportuni- ties that depend upon the economic situation, prospective, and major events that occur locally. Office buildings represent nearly 70% of our assets under management, but our diversification strategy leads us to cover all segments of the real estate market, from hotels to warehouses and commercial buildings. More than ever, we are targeting core assets, which allow us to forestall the destruction of value and performance in times of crisis.

We aim to transform existing buildings into core ESG assets that comply with the highest environmental and energy consumption standards. We benefit from a diversified client base made up of both retail and institutional inves- tors. They value our ability to give them access to the best real estate assets in France (Paris, Lyon, Marseille…) and over all major European cities: London, Berlin, Amsterdam, Prague, Milan.

We benefit from a diversified client base made up of both retail and institu- tional investors. They value our ability to give them access to the best real estate assets in France (Paris, Lyon, Marseille, …) and over all major European cities: London, Berlin, Amsterdam, Prague, Milan.

These investments are carried out via open or closed funds, club deals, co- investments, and dedicated mandates. Drawing on its 40-year track record, Amundi RE manages all types of investment solutions for its French and European clients: club deals, co-investments, dedicated mandates, and closed-ended or open-ended funds.

Performance verification

Amundi Real Estate (corporate name: Amundi Immobilier) is approved by the Insurance companies French Securities Authority (Autorité des Marchés Financiers – AMF) under No. GP 07000033 and therefore follows its performance verification standards.

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_{These materials are provided for use by qualified institutional investors for informa- tional purposes only and are not intended as solicitations of investment business. The information and opinions are based upon sources that are considered to be reliable, but no representation or warranty is made as to their completeness or accuracy. Past performance is not necessarily a guide to future performance. Further information is available on request. Amundi Immobilier is approved by the French Securities Authority Autorité des Marchés Financiers – (“AMF”) under No. GP 07000033}