This week, I am incredibly proud to have been invited to speak at ULI France Annual Conference, alongside some of France's smartest real estate professionals.
France expects a real estate revolution
M. Pierre Shoeffler, Senior Advisor at IEIF, opened the day with a compelling argument in favor of residential investment. The basis of his argument is the robustness of residential performance over years: residential properties have always outperformed general portfolios.
Surprisingly, France does not have any publicly-traded multifamily/residential investment companies, as large portfolio holders have elected to focus on offices and other commercial assets. This means that, up to now, French housing is primarily owned by individuals, with the exception of a few family-offices.
However, earlier this year, the train company SNCF has sold 80% of its residential portfolio (railway workforce housing), forcing large real estate investment firm to reconsider housing as a productive investment. Because housing is a value-add asset, just like stock, while all other real estate assets are income-based, Pierre Schoeffler expects to see at least a dozen of residential funds on Paris' stock market by 2030. For him, this is the first true disruption - or revolution - in the French real estate market since Haussmann!
Big opportunity, big fish?
Two panels then explored the practical feasibility and appetite of those large funds to invest in residential. While, Méka Brunel, Gecina, and Xavier Lépine, La Française, agreed on the need to focus on high-quality, flexible and collaborative "living spaces" - this resonates with me! - Xavier Jongen, Catella, and Marcus Cieleback, Patrizia, shared European success stories and discussed applicability to the French market.
Our diverse second panel, made of men & women, from the public, private and non-profit sectors, discussed the rapid emergence of new classes of assets based on use and experience. I had the opportunity to share insights on multigenerational co-living with Jacques Pleurmeau, Quartus, who confirmed that a significant share of senior citizens have very similar needs to young professionals, or divorcees. Stéphan de Faÿ, Euratlantique, concluded the debate with a stress on the supply/demand gap created by the "standardization" of our homes, validating the need for new forms of housing, but but rightfully reassured AXA IM and the institutional investors reminding us all of the non-fading predominance of traditional housing.
Thank you to the entire ULI France team for a great event!
[Presse en français ici. Merci Édouard du Penhoat!]