Nicolas Simon, Amundi Real Estate

With €688.7 billion in assets under management and management teams operating in the major financial centers in Europe, Amundi Group is one of the world market leaders in asset management. Here Nicolas Simon, CEO of Amundi Real Estate, shares his thoughts on the company’s current and future projects.

Who is Amundi, what do you do and which markets do you work in?

“Amundi Real Estate is the property branch of Amundi, which is one of the top 10 companies in the world in asset management, with almost €700 billion in AUM. The real estate business within Amundi is €6.7 billion, so it is quite small compared to the size of the group. This is actually good news because we have much room to grow and to improve our position.

“The real estate investment management industry in France is quite young, because of the recent development of regulations, and we are now growing rapidly, both with retail investors through our affiliated banking networks and IFAs, and with institutional investors.

“Today we cover mainly France and we have started developing in Europe; in Italy we have activities for retail funds and a fund of funds for private investors and in Morocco we manage an development fund for institutional investors. We also have some activities in the UK and in Germany, where we are currently deploying more capital on behalf of Italian or French funds.

“The main focus of our business are offices, the main and most liquid market, but we have also sound developments in the retail, logistics and residential sectors, mainly in France, as well as some hospitality and diversification products, like wind farms or forests. However, our main focus today is offices, which represent 60% of our portfolios. We have a team of 80 people, most of whom are located in Paris, and a few people on the ground in Luxembourg, Italy and Morocco.”

What differentiates you from the competition?

“First of all we have a very long track record in the French market, because our retail funds have been active for the last 30 years, so we have an extensive knowledge of the French market. We also have very good access to the market through our networks with developers, brokers, lawyers, and all kinds of professionals due to the link with the investment banking side of the group”.

“We have good access to off-market deals, we have a strong selection process, a disciplined investment process, we are very flexible to adapt to our client needs and we offer competitive fees. In today’s market this is important, and thanks to the size of the company we can provide competitive solutions, both for institutions and for private investors, so we deliver good performance at a reasonable cost.”

The last few years have seen a very difficult market for a lot of companies. How has it been for you?

“For us development is very steady now. Last year we grew our asset under management by 40%, and there are various factors contributing to that; we are benefiting from the financial crisis because the turmoil in financial markets drove more interest for real estate, so real estate is a growing asset class for most individuals and institutions.

“It is perceived as a safe haven to protect capital and to get regular income with some indexation on the expected regain of inflation, so there is a demand for these investments. Furthermore, in the French market there is a lot of innovation in vehicle products with the new OPCI schemes, a regulated vehicle we have contributed to develop and promote in the market place.

“To give you some figures, the in-flows in retail investors market almost doubled last year and have still grown by 15% in 2011 and on the institutional market there were almost no vehicles five years ago and today it is above €20 billion. We take a good share in these markets, we are actually number two on the retail fund market in France and in the top five for institutional investments.”

What would you like to achieve between now and this time next year?

“We have several projects for 2012; we have launched ‘OPCIMMO’, a very innovative fully open-ended retail fund to give access to retail investors to the European markets, besides the pure existing domestic French products.

“On the institutional side we think that there will be good opportunities in the investment market due to the general deleveraging, the lack of new debt and the maturing of funds that have been created in 2006 and 2007, and that will wind up this year and next year.

“We will organize club deals to mix foreign capital with French capital in order to benefit from those opportunities. We are also working on new investment strategies that should benefit from those opportunities, as well as from the new public transportation system that is developing around the ‘Greater Paris area’ and will create new development arrears, that we think are good value from investors.”

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