Le mie ricette per la real estate communityGermany’s largest independent investment
company Universal-Investment has reached another milestone on its ambitious growth path as fund
service platform – the acquisition of the Yi Fang Towers in Shanghai in cooperation with Alpha Investment
Partners Shanghai for a real estate fund of its client Bayerische Versorgungskammer. This marks the first
direct investment in China as well as the 1,000th property to be administered in a special fund for
institutional investors.
«Buying 1,000 properties worldwide in around eight years together
with institutional investors and asset managers is a tremendous
growth story that underscores the quality of our offering and the
high level of trust that customers place in us. The very positive
development of our real estate business represents an important
milestone for us on our way to becoming the largest European fund
service platform for all asset classes. We will continue making
significant investments in specialists, IT and new locations to achieve
this» said Michael Reinhard, CEO of Universal-Investment.
Globally active – strong demand in Asia
Since breaking into this segment, Universal-Investment as a fund service platform has launched 45 special
funds for institutional investors, such as pension funds or insurance companies as well as fund initiators,
and has teamed up with 35 real estate asset managers searching worldwide for the best properties. This
is also reflected in figures: in 2019, more than one third of all real estate purchases for funds on the
platform were made in Asia. Therefore an office is to be opened in Asia soon in order to build up local
capacities and expertise.
Universal-Investment creates the appropriate structures for clients to enable them to invest efficiently
and flexibly. At the same time, the company provides support in meeting all necessary legal requirements
and helps to create transparency through state-of-the-art reporting. To further automate real estate
administration, the company is also investing in enhanced IT systems and data analytics to further expand
its range of services for customers.
Real estate and other alternatives growing in importance; KVG model continues to assert itself
One reason for the real estate segment’s strong growth is the changing behaviour of investors. In
response to the persistently low interest rates, they are investing more in alternative asset classes, such
as real estate, with which adequate returns can still be generated. Since the product division was founded
in 2011, the gross volume of administered real estate funds has grown from an initial 1.1 billion euros
to over 22 billion euros.
The second growth catalyst is the German Master KVG concept from the securities sector which has now
been established in the real estate sector. In the early 1990s, Universal-Investment pioneered the
approach of separating portfolio management and administration in the securities sector; today, around
60 percent of securities special funds in Germany follow this principle. In 2011, Universal-Investment
became pioneer again by being the first investment management company to apply the Master KVG
concept to the real estate sector. At the moment, every fourth euro invested in German real estate special
funds is managed according to the Master-KVG principle, and the trend continues to rise. Within just a
few years, Universal-Investment has risen to third place on the league table of the largest providers of
real estate special funds in Germany. «With the Master KVG concept, we create efficiency, transparency
and flexibility for our clients – for all asset classes. Our experts at our locations in Germany and
Luxembourg also enable customized solutions to be created for every investor» Reinhard continued.
Shift in real estate allocation in terms of region and sector
A close look at the asset allocation also reveals some clear developments. An analysis of the real estate
capital invested on the Universal-Investment platform shows that demand for North American real estate
has been continuously rising since 2014, while now investors regard the price level as no longer tenable
and have therefore recently lowered their exposures. In contrast, the Asian markets have become more
attractive. «China in particular is gaining in importance because broadly diversified investors are no longer
able to capture the expected returns in saturated markets and are evidently prepared to take higher
risks» explains Marcos Joos, Head of Real Estate Investment Management. «Our current real estate
investor survey shows that the price level in Europe, especially in core locations, is increasingly no longer
regarded as acceptable. This is another reason why, with 9 percent of all respondents, far more real
estate investors are considering Asia than in the past» added Joos.
Changes at sector level can also be seen. The share of retail and catering in real estate investments on
the platform has been falling constantly for years, most recently to 33.1 percent. In 2016, 44.2 percent
were still invested in this class. Instead, more and more is being invested in office space and apartments,
especially in niche segments such as micro living or student residences.
Source : Company
