Peter Helfrich, Regional Head North West Europe, Patrizia, tells Real Estate Day that investors are interested in a range of sectors in the Netherlands: logistics is in demand, healthcare and senior housing is rising up the ranks and offices are getting hotter, but high street retail is still struggling
Nils Styf, CEO, Hemsö Fastighets AB, tells Real Estate Day that the property company is focused on social infrastructure, which means nursing homes, schools, hospitals, health care clinics, and has €5.2 bln in assets with a very long-term horizon as it’s owned by the Swedish National Pension Fund
Reno Cardiff, International Partner, Cushman & Wakefield, tells Real Estate Day that a few years ago the sector attracted value add capital, but now it’s core capital looking for investment and often forming joint ventures with existing operators in the market
CORESTATE Capital Group has big ambitions to expand its footprint in Europe from its base in Germany focusing on offices and residential, newly-appointed CEO Lars Schnidrig told The Real Estate Day.
‘We are concentrating on megatrends, so half of our portfolio is residential and micro living and the other half is core office in core cities and in prospering medium-size cities,’ he said. ‘We want to become the leading real estate investment management house in the Eurozone and the preferred partner for our valued clients’.
At present 75% of Corestate assets are in Germany, where it has 700 employees and €26 bln AUM.
The group discovered micro living ten years ago, so it had time to build up its operations in this asset class and it has become market leader in Germany.
‘Our clients ask for flexibility in how they live and in how they work and we aim to have products ready for each and every generation,’ Schnidrig said. ‘Our plan is to roll out our micro living products throughout Europe’.
The gap between supply and demand in residential is the same in Germany and in the rest of Europe. This is why mezzanine finance has become a key strategy for Corestate, he said, which has become market leader in German-speaking areas.
‘Cities are booming and people need more homes,’ Schnidrig said. ‘The German government has set a target to build 1.5 mln homes between now and 2021, but someone needs to finance them. So we provide the mezzanine finance, the banks provide the senior loans and the developers the equity portion. As with micro living, we are planning to spread this out throughout Europe’.
Sustainability is another focus. ‘We have spent a lot of resources in financial terms but also in time devoted by our colleagues to this topic,’ he said. ‘In due course we will publish our first digital ESG report, which will be totally transparent and will commit us to clear targets which we can be measured against’.
Being sustainable is now a prerequisite to do business with institutional clients, who are still 30% under allocated to real estate. ‘We are investing in our infrastructure in favour of our clients,’ Schnidrigsaid. ‘We want to set a new industry standard for sustainability’.
Andreas Löcher, Head of Investment Management Hospitality, Union Investment Real Estate, tells The Real Estate Day that there is great domand for hotels as investment opportunities, but the challenge is to identify the right assets and then structure the deal correctly
Brian Welsh, Chief Executive Officer, Nido Student, tells The Real Estate Day that they are trying to expand their footprint in Portugal and establish a presence in Spain, but the student housing market has become more competitive and crowded and opportunities are more difficult to come by
Asli Kutlucan, Chief Development Officer, Cycas Hospitality BV, tells Real Estate Day that the hotel and hospitality sector must prepare for the next biggest market and provide specific services, including rice cookers in extended stay hotels, or risk missing the opportunity
Romain Gowhari, Executive VP, Head of Transactions France, Hotels & Hospitality, JLL, tells The Real Estate Day that US private equity investors have been looking at the French market but have been unable to find anything to buy, so portfolio owners must be persuaded to sell and unlock capital gains
Alexandre Couturier, Partner, Clifford Chance, tells Real Estate Day that in France there are many differerent types of contract now that suit different hoteliers and operators, varying from lease to management contract and from franchise to vacant possession
Millennials’ increasing mobility and new demands are creating opportunities to develop new hotel concepts, Asli Kutlucan, Chief Development Officer, Cycas Hospitality BV, told Real Estate Day.
‘This is an exciting time for creating new combinations in the market purely based on millennials’ lifestyle,’ she said. ‘Unlike previous generations, they don’t want to be born, raised and retire in the same city, they are very independent and are happy to go, live and work in different cities around the world’.
This generation is not interested in investing into real estate because such an investment would tie them down, but they prefer to find jobs in locations where they can live for six months or a year and then relocate to another place where they can absorb the culture and traditions of a different country.
Their new demands are being met by new hotel concepts. ‘We have seen a massive change in the market because millennials on a short stay are not interested in a large room but just in the functionality of the space where they are going to sleep,’ Kutlucan said. ‘Their culture is all about sharing and connecting, especially if they are new in a city or a country’.
What they prefer is the new lifestyle hotels which come with small but comfortable and practical bedrooms and have massive shared areas where they can connect, drink, eat and relax, she said.
Extended stay hotels are also favoured by millennials who are looking to go and work on a short-term contract or relocate temporarily to different cities across countries.
‘This trend is set to continue’, she said. ‘The lifestyle hotel concept is growing massively and from our perspective the combination of an extended stay and a lifestyle hotel, especially under the same roof, provides the perfect solution for the new generations’ demands’.
The first ventures into these new concepts have been very successful, Kutlucan said: ‘We opened our Moxy and Residence Inn concepts in Amsterdam last year and the results are exceptional. In our first year and a half we achieved phenomenal success. Happy customers mean good money’.
The feedback from millennials in the fashion and IT sectors but also from the more traditional corporate world has been very positive, she said: ‘They love the whole concept, so we are planning to do more’.
Extended stay is not just for millennials, though, but it is an exciting market in general, especially in France which for a long time was dominated by brands like Accor and Adagio which were never managed professionally, Kutlucan said.
Now it is all changing: ‘Big names like Marriott, Hyatt and InterContinental are interested in France and they see extended stay as a growth market so they are bringing these branded extended stay hotels into the country and seeking to extend their footprint in the country,’ she said. There’s a Hyatt House under construction at Charles de Gaulle and another in the pipeline as well as a Staybridge.