september 2020
In our last report, written during the lock-down1, we said that the current crisis would be composed of three phases: rent collection during lockdown; the economic recession; and lastly the longer term impact of the COVID-19 crisis on the real estate sector.
The general consensus is that French real estate investment companies (SCPIs) have handled the first phase pretty well, with fund managers posting average rent collection rates of 80 to 90%. Dividends paid in the first half of 2020 were on average 90% of those paid in H1 2019, with a portion of rents sometimes set aside as a reserve for future payments.
We are now entering the second phase of the crisis, i.e. its economic impact, with soaring unemployment and the risk of a cascade of business closures. One decisive factor will be whether or not welfare compensations will be maintained, as was the French government’s subsidised partial unemployment scheme, which was recently extended for another 12 months.
How can savings be redeployed and what role can real estate play if crisis constraints need to be
maintained for an extended period, even if less severe?
The team
With a university education in local economic development, Daniel While began his career as business establishment consultant to local authorities. In 2006, he joined the Institut de l’Epargne immobilière et Foncière as analyst, and specialised in the world of unlisted real estate funds (SCPIs and OPCIs for France).
He is co-author of the book Les OPCI published by Delmas (September 2008). He joined Primonial REIM in 2017, where he held the position of Development Director, then Research & Strategy Director from 2019.
Henry-Aurélien Natter joined Primonial REIM as Research Manager in January 2018. He has the mission of developing the analyses of the Research & Strategy Department on the real estate markets, the economy and capital in France and in Europe.
Henry-Aurélien Natter began his career at Les Echos Etudes (formerly Eurostaf), then at C&W (formerly DTZ), and lastly at BNP PRE, where he acquired solid and varied experience in real estate research, strategy and finance. He is qualified with an AES degree in Business Management, a Masters Decree in management and SME management, and an International Master in commerce and marketing.
After a successful internship in Primonial REIM France's Research and Strategy team, Adrien Isidore joined the team as an economist-statistician in late 2020. Adrien holds a Master's degree in Economics and Statistics from Panthéon-Assas.
Adrien Isidore decided to become an economist after an exchange program in Australia during which he worked in international research groups on various projects, giving him a taste for research. He also holds a bachelor's degree in economics and a university degree in mathematics and finance. His role is to propose innovative statistical tools and to write studies on different countries while providing support in the structuring of the department at the European level.
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