SCPI, bilan du 1er semestre 2021 et perspectives
We are working on the SRI label for our SCPI Primovie, which we hope to obtain by the end of the year. Primovie would become the largest real estate fund mainly invested in health, life and education real estate with SRI certification, thus confirming our position as a forerunner in this market.
How would you assess the SCPI market in the first half of 2021?
Stéphanie Lacroix – Real estate, in line with 2020, continues its role as a safe heaven. Last year, the appeal of unlisted real estate funds remained undiminished despite the crisis we went through. SCPIs collected more than 6 billion euros in net new money₁. The SCPIs managed by Primonial REIM offered an average yield of 4,60 %, higher than the rest of the market (4,18 %) on 12/31/2020.
Q1 2021 figures show that SCPIs continue to enjoy strong appeal among private and institutional investors. Primonial REIM has collected more than €340 million for its SCPIs alone, ranking first among management companies.
This trend is expected to accelerate. According to the Banque de France, the French have accumulated 142 billion euros in savings since the beginning of the health crisis. The low interest rate environment naturally supports real estate prices and favors the purchase of SCPI units on credit
SCPIs give investors the opportunity to diversify their investments by investing indirectly in various real estate sectors. They offer a balanced risk/return ratio.
While many signals suggest that the health crisis is gradually coming to an end, how do you see the second half of the year?
Stéphanie Lacroix – 2021 promises to be a year of transition. The evolution of the health situation will favour a more or less rapid economic recovery, supported by consumption and by an acceleration of investment.
Primonial REIM's ambition is to ensure in 2021, for its real estate savings solutions, potential performance levels at least equivalent to those of last year₂.
Today, investors are looking for real estate assets that are well located, efficient and leased to reputable tenants. In a word: resilient assets. This flight to quality einforces our allocation choices, which focus on prime/core and diversified assets. This is illustrated by our most recent acquisitions, such asthe Shift building in Issy-les-Moulineaux, which is fully occupied by Nestlé and meets the highest environmental standards (certified HQE Exceptional and BREEAM Excellent)..
Our investment and management policies are in line with the new uses reinforced by the health crisis: strong demand for social infrastructure (health, education), flexible work spaces, digitalization… They meet the growing need of investors for meaningful investments. Primonial REIM was one of the first management companies to obtain the SIR label for two funds: the SCPI Primopierre and the OPCI PREIM ISR. By aiming to improve the ESG criteria of our assets, and thus the quality of our real estate assets over time, we are convinced that it is possible to reconcile economic performance and sustainable development
Given this encouraging context, which real estate asset classes should be favored by investors?
Stéphanie Lacroix - We believe that core office real estate, which includes properties in the most dynamic locations, will remain attractive. The importance of the head office has been reaffirmed during the crisis. As a true management tool, a vector of cohesion and belonging, it is becoming a necessity in a hybrid model combining face-to-face work and telecommuting. Primopierre, an SCPI mainly invested in office property, maintained a high level of performance (5,04 %) in 2020. Its assets, mainly large buildings in the Paris region, are highly selective in order to meet the aspirations of companies: energy performance, quality of ventilation, employee services, etc.
Healthcare and education real estate has also emerged stronger from the crisis, which has revealed massive needs for social infrastructure: EHPAD, clinics, etc. With leases of 12 years on average, these assets generate potential income that can be anticipated over time. The SCPI Primovie, France's largest healthcare fund with €3,4 billion in capitalization, has delivered an above-average return (TDVM: 4.50% in 2020) in a favorable demographic context (aging population, longer life expectancy, etc.). In order to pursue our commitment to responsible real estate, we are working on the SIR label for our SCPI Primovie which we hope to obtain by the end of the year. It would become the largest real estate fund mainly invested in life and education real estate with SRI certification, confirming our position as a forerunner in this market.
Finally, we believe that the potential for gains in the residential real estate sector remains very high thanks to rising property prices. The SCPI Primofamily, perfectly suited to investors wishing to diversify their savings into everyday real estate in Europe, by focusing its investments on cities with high rental pressure.
*1 Source: ASPIM-IEIF statistics at 31/12/2020
*2 - Past performance is no guarantee of future performance. The potential income of the SCPI as well as the value of the units may vary up or down depending on the economic and real estate situation. Investing in the fund involves risks, including the risk of capital loss.
TDVM: the Market Value Distribution Rate measures the level of distribution by dividing the gross dividend before withholding tax paid in respect of year n (including exceptional interim dividends and share of distributed capital gains) by the average share price of the year.