PATRIZIA Immobilien AG (Real Estate)

2017 Real Estate Top 100 ranking: 47http://www.patrizia.ag/en

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Manager Details

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Corporate overview

Founded in 1984 by Wolfgang Egger, today’s CEO and majority shareholder (51.62%), PATRIZIA today counts on 21 offices and five investor relationship hubs in 17 countries across four continents to service our global client base. PATRIZIA has been active as an investment manager in the real estate market across Europe for more than 30 years. PATRIZIA’s activities include the acquisition, management, repositioning and sale of residential and commercial real estate through its own licensed investment platforms. As a global partner for pan-European real estate investment, PATRIZIA operates as a respected business partner of large institutional investors and retail investors in all major European countries. PATRIZIA manages almost €40bn of real estate assets, primarily as an investment manager for insurance companies, pension fund institutions, sovereign funds, savings and cooperative banks and as co-investor.

Investment principles & strategy

One-stop shop

PATRIZIA is an investor’s ‘one-stop shop’ for pan-European real estate investment. It offers a range of compelling products and formats, covering the full risk spectrum – from core to opportunistic, and across sectors and countries. Our extensive on-the-ground presence means that we can offer investors a unique set of opportunities, at the right time. Whatever the style of investment, we approach it as our client’s fiduciary.

Long-term partnerships built on trust

  • PATRIZIA has over 350 valued clients from 21 countries and five continents, and over 50% of these are repeat-investors.
  • Many of our client relationships go back over 30 years, a reflection of a personal and trustworthy service provision, across investment strategies and formats. Governance, transparency and performance are at the heart of PATRIZIA’s approach to its client partnerships.

Tried and tested approach

  • Our industry-leading research capability and extensive local teams enable us to combine top down, strategic ideas with bottom up, deal-driven stock selection.
  • We hire the best investment professionals in all major European markets (we only invest were we have people ‘on the ground’).
  • We believe in active asset management to enhance income and preserve capital.
  • When appropriate, we commit to disciplined, timely asset sales in order to capture growth and performance for our clients.

Sector forecasts

Quantitative easing measures continue as an important driver for bond prices in a first step and for financial asset values in general in a second step, resulting in rock-bottom prime yields in nearly all markets. Liquidity and not interest rates will therefore be the indicator to be watched in the coming quarters, when ECB tapering will crucially influence the overall liquidity situation and, ultimately, pricing. The liquidity effects transmitted via the capital markets contrast with a fundamentally solid and often positive market environment consisting of low vacancies, low speculative construction activity and positive rental development and outlook. Despite this supportive market environment, allocating capital with the envisaged yields will be the most pressing challenge for many institutional players.

INDUSTRIAL: With consumer habits changing the retail industry more than ever, investor strategies need to adapt in order to remain competitive and successful. Retailers have to respond to changing shopping patterns by optimising the number of their store locations and developing models to integrate online sites/stores into them. As a result, larger parts of the logistics sector will effectively become a ‘retail derivative’, opening up new investment opportunities but also creating new challenges for retail and logistics investors.

OFFICE: Rising labour demand continues across the main European cities and results in strong demand for office space. With the very low levels of construction activity, particularly speculative construction, vacancy levels will also remain low in the key markets. As a consequence, office markets will see rental growth which is more broad-based across Europe. Still, it is essential to understand the fundamentals behind the changing dynamics of rental growth on a city basis when developing a European investment strategy, so as not to get caught on the wrong foot when the cycle turns.

RESIDENTIAL: Construction levels in Europe are slowly rising but continue to fall below the required new supply that is mainly driven by strong urbanisation trends. European residential markets saw a strong recovery over the last four years. This development is the result of a broad-based, synchronised economic recovery and the expansionary monetary policy in Europe. In parallel, and as a consequence of increasing house prices and the imbalances between demand and supply, prices and rents show a gradual upward trend. This emphasises the overall improvement in the residential market and opens opportunities for higher return investment strategies.

RETAIL: EU retail sales continue to grow across Europe due to economic and labour market improvements. Today’s retail disruptors are digitalisation and e-commerce. Online giants such as Amazon and eBay are easy to identify as (current) winners of market changes. In contrast, increasing vacancy rates in smaller cities and city sub-markets with declining populations and secondary locations, as well as the difficulties of large department stores, give a hint as to who are the losers in this game. However, the development of prime rents indicates that even top locations in the city centre are not immune to current upheavals and investors will therefore adapt their retail strategies to the new environment.

OTHER: Student housing, boarding houses and co-working schemes continue to capture a rising share of investment as our way of living and working is changing continuously and real estate adapts to it. As a consequence furtherinvestment activities in these areas are expected, not at least because these ‘new-niche’ sectors constitute new investment opportunities in highly competitive markets.

Strategic corporate development

PATRIZIA has one aim: To be the leading global partner for pan-European real estate investment.

With €40bn under management and a long-standing track record of successful M&A activity, PATRIZIA has evolved into one of Europe’s top ten real estate investment management platforms. Of particular note were the 2017 acquisitions of global fund-of-funds manager, Sparinvest Property Investors (SPI), German investment manager, TRIUVA, and London-based pan-European fund manager, Rockspring. The integration of four companies into ONE new PATRIZIA has increased the firm’s diversity of product offering, on-the-ground presence and investor insight. Going forward, PATRIZIA and its clients will benefit from:

  • opportunities in European real estate which cover all risk styles, geographies, sectors and formats;
  • an entrepreneurial and independent spirit, ethos and approach – unique in the industry;
  • a 34-year history of serving institutional investors from around the world and meeting their reporting and regulatory requirements;
  • local in-house transaction and asset management teams of significant scale;
  • a long-term track record in both commercial and residential property;
  • a commitment to the highest standards of corporate governance, risk management and compliance.

In addition, the company is taking a tech leadership role in the industry, actively digitalising the business in order to achieve both economies of scale and client service excellence. This effort is driving further innovation and growth, firm-wide, as PATRIZIA continues its transformation.

COMPLIANCE STATEMENT

These materials are provided for use by qualified institutional investors for information purposes only and are not intended as solicitations of investment business. PATRIZIA will not accept any responsibility for this publication or the information included herein. In particular, PATRIZIA has not verified or examined the information contained in, or referred to by, this publication or this publication in its entirety, nor has it convinced itself in any other manner of the reasonableness, correctness and completeness of the information concerned. PATRIZIA shall not provide any warranty or guarantee in relation to the reasonableness, correctness or completeness of the information or opinions in or concerning this publication.

News from PATRIZIA Immobilien AG (Real Estate)

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News from IPE Real Assets

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White Papers / Research from PATRIZIA Immobilien AG (Real Estate)

  • Patrizia European City Ranking download

    In today’s world are not about countries. In a globalising and urbanising world they are about regions or cities. 

  • The European residential opportunity download

    Why It Is Now The Right Time To Execute A European Residential Strategy

  • Where to invest? – A long term equilibrium analysis from a core perspective download

    Looking at investment intention surveys over the last years a common theme can be observed: Target real estate allocations of institutional investors have been increasing constantly! Since 2010 this development has lead to continuously increasing investment volumes as investors try to chase their moving target.

  • Diversification potentials in European housing markets download

    The different economic, financial and, most importantly, institutional and structural factors on the European housing markets currently make it challenging to develop a pan-European residential investment strategy. The structural differences constitute one of the reasons why the performance of residential assets varies strongly. While factors such as interest rates, government bond yields and demographic demand play an important role in the common understanding of housing markets, other ...

  • Office space trends in Europe: The disappearance of the adjustment cycle download

    The cyclical growth pattern of office stock across European markets in the last decades has been subject to several structural breaks and changes, which has resulted in a less flexible supply side.

View more White Papers / Research from PATRIZIA Immobilien AG (Real Estate)

Analysis from IPE Real Assets

  • Will Patrizia and Aberdeen Standard go global?

    German real estate investment manager Patrizia Immobilien is expected to increase its assets under management by nearly 50% when it completes its takeover of Triuva

  • Germany: Moving the dial

    Pension funds BVK and ÄVWL are pushing their property allocations beyond 20%. Barbara Ottawa reports on the challenges they face

  • Retail: Food for thought

    Staying focused on changing retail models is equally important as paying attention to consumer behaviour, writes Russell Handy

  • City Focus: Banking on Frankfurt

    While there is talk of UK banks moving to Frankfurt following the Brexit vote, the city is trying to attract other types of tenants, says Russell Handy 

  • Residential Europe: Going global? Go local

    Global residential strategies are a reality. But investors should be aware of the diversity of housing in Europe, writes Marcus Cieleback

View more Analysis from IPE Real Assets

Head Office
PATRIZIA Immobilien AG
Fuggerstrasse 26
86150 Augsburg
Germany
Company website:
http://www.patrizia.ag/en
Year Founded:
1984

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