Key Primonial REIM figures and data for 31/12/2019
• A historic fund collection campaign reaching a total of 5.3 billion euros[1] for all of the managed trusts (+23% vs. 2018)
• Leading fund collector[2] on the SCPI market with • 1.3 billion euro collected
• The completion of significant property acquisitions representing a large contribution to the dynamics of the office property investment market in general
• 21 billion euro[3] in assets under management at 31.12.2019 (+22% vs. 2018)
In 2019, Primonial REIM displayed a historic performance which confirmed the extent of its ambitions and demonstrated its ability to accelerate the deployment of its strategy.
Grégory Frapet, Chairman of Primonial REIM: “I am very proud of the 2019 figures; they are truly remarkable, both in terms of fund collections and the quality of our investments. I would like to mention the commitment and expertise of the Primonial REIM teams which have allowed us to out-perform the market once again. These historic record performances confirm the pertinence of our strategy, based on a conviction management approach which seeks to offer a property asset allocation to our clients combining performance, regularity* and underlying quality. 2019 will be remembered for its major property transactions such as the acquisition of the “Le Lumière” building, the largest commercial complex in Paris, or our first hotel investments, an entirely new asset class for Primonial REIM. In this positive but highly competitive market dynamic, Primonial REIM has everything it takes to reach its growth objectives for 2023: progress from 21 billion euro in assets under management to 30 billion euro by reinforcing our status as the leading office and healthcare sector property investment company, these two asset classes will continue to be at the centre of our business model.
“ Stéphanie Lacroix, Primonial REIM’s Managing Director: “In the current low-interest rate situation, property has become a much sought after investment solution, with the objective of providing reliable performance that will remain greater than that of euro funds. The 2019 collection figures show the interest generated amongst private and institutional investors for the investment solutions proposed by Primonial REIM, which seek to propose regular and long-term potential revenues. Thanks to our corporate values, we will take our commitment even further in 2020, favouring sustainable investments and continuing to innovate to propose property investment solutions that will meet the very specific expectations and requirements of our clients. “
1/ 2019 COLLECTION RESULTS AND FUND PERFORMANCES
A/ Net collection for 2019
Primonial REIM recorded a record highest collection volume of 5.3 billion euros in 2019 for the 3 investment plans that make up the core of its activity.
• The collective property investment trusts (SCPI) managed by Primonial REIM collected 1.3 billion euro. Primonial REIM has once more confirmed its position as the leading fund collector with the highest figure increase on the market (+15% vs. 2018). This performance can be explained for the most part through the success of the market leading SCPI[4] , SCPI Primovie, specialised in healthcare and education property investments, which registered a total fund collection of 610 million euro. And there is also the office space SCPI, Primopierre which registered 535 million euro in fund collections. Its model is based on rental incomes generated by the quality of the properties involved and the capital gains from the transfers of assets as they reach maturity having completed creative and value generating asset management work. On 31.12.2019, the capitalisation for all of the managed SCPI was more than 7 billion euro[5] , which places Primonial REIM amongst the top three asset management companies.
• The Property Unit of Account plans, such as Primonial Capimmo and the general public OPCI PREIMium which are exclusively available through life insurance policies, have registered total fund collections of 1.8 billion euro in 2019.
• The property club deal activity registered a total of more than 2.1 billion euro in fund collections. This year has been marked by some major transactions, notably in the office space and hotel sectors for French and international institutional investors.
B/ 2019 performances
The average performance for the Primonial REIM “general public” property trusts was 5% for 2019.
The average performance for 2019 of Primonial REIM SCPI (open to subscription) was 5.10% excluding commission, which was above the market average of 4,40%[6] for the year. OPCI PREIMium and SCI Primonial Capimmo achieved annual performances of 5.17% and 4.56% respectively excluding commissions for 2019.
II/ 2019 PROPERTY RESULTS
With a record volume (excluding residential) of 36 billion euro for the whole of the market, 2019 was an extremely dynamic year for investment.
Primonial REIM played a large role in activating this market through a number of major acquisitions for the property trusts managed for the various asset classes: offices, healthcare/education, retail and residential: • “Le Lumière”, Paris’ largest commercial property complex, 136,000 m2, Paris XIIe (1.06 billion euro**)
• “Le Jour”, a 25,000 m2 office property in Paris XIVe (310 million euro**) • A German property portfolio including 20 healthcare establishments with a total surface area of 120,000 m2 (185 million euro**)
• A Dutch property portfolio including 42 “city-centre” retail outlets (102 million euro**)
• A mixed property portfolio including residential, retail and office units, with a total surface area of 14,50 m2, in Lyon (94 million euro**)
In addition to this our first hotel investments have been made including the acquisition of a portfolio of 90 B&B hotels in France (399 million euro). This is a new class of assets for Primonial REIM’s asset management activity.
In 2019, the Asset Management teams completed a number of arbitrages, largely concerning the transfer of office property assets, for a total value of more than 918 million euro.
A development projects pipeline covering almost 335,000 m2 has been identified in the office, retail, healthcare/education sectors presenting a significant value creation potential for the coming years.
In addition to this, some major leasing transactions have been secured with almost 365,000 m2 rented, re-rented or renegotiated across all of the asset classes. The property portfolio managed by Primonial REIM for its client investors is distributed across 7 European countries and totalled more than 4,251,000 m2 at 31/12/2019.
III/ PERSPECTIVES FOR 2020
Considering its strengths and the favourable market context, Primonial REIM has total confidence in its capacity to continue its current growth curve by building on these strategic priorities:
• Build up a property allocation which combines cash-flow, value creation and patrimonial assets;
• Continue to diversify across business sectors and geographical zones as well as property trusts;
• Reinforce its property investment market leader status;
• Continue to attract more French and international institutional investors by structuring investment solutions to meet their performance objectives;
• Strengthen its responsible investor approach to create more sustainable capital gains.
2019 Primonial REIM trust performance appendix
In 2019 the Primonial REIM trusts outperformed market reference figures (source: Aspim - IEIF).
Previous investments are not a reliable indicator of future results. Investing in investment funds involves risks such as losing all or part of one’s capital.
________________________________________ 1 The collection figure includes amounts subscribed to the trusts as well as the amounts invested via club deals – source: Groupe Primonial
2 Source: ASPIM-IEIF, Le marché des parts et performances (The share market and performances) au 31/12/2019
3 Scope: assets under management corresponding to the expert evaluations of the managed assets as well as the representative share of expert evaluations of un-managed club deals and the values of other participations (listed trusts, OPCVM, etc.).
4 Source: ASPIM-IEIF: Le marché des parts et performances (The share market and performances) au 31/12/2019
5 All of the Primonial REIM SCPI
6 Source: IEIF, Le marché des parts et performances (The share market and performances) au 31/12/2019, excluding residential
7 TDVM: Taux de Distribution sur Valeur de Marché (Market Value Distribution Rate) which measures the rate of distribution by dividing the gross pre-release fee dividend paid out in year N (including any exceptional advance payments and the representative ratio of the capital gains paid out) by the average buyer share price for that year.
8 EVP: Evolution des valeurs des parts (Share value changes)
9 TRI: Internal rate of return (IRR) the annualised internal rate of return for the period, with the buyer price for the first year taken into consideration as the starting point, and the execution price (fixed capital SCPI) or withdrawal value (variable capital SCPI) on 31 December of the final year as the outcome, and the distributed revenue before release fee payment for the period.
* Property asset/FIA performance and revenues are not guaranteed
**HD figures
About Primonial REIM
Primonial Real Estate Investment Management (Primonial REIM) is a portfolio management company certified by the AMF in 2011; it creates and manages a range of investment schemes based on strong property market convictions. Its main objective is to propose a range of SCPI that invest in office, retail, health/education and residential property to the broadest possible client-base.
As a portfolio management company Primonial REIM sets up and manages OPCI (specifically aimed at either institutional or general public investors). On 10 June 2014 Primonial REIM received AIFM (Alternative Investment Fund Manager) certification from the Autorités des Marchés Financiers (Financial Markets Regulator), and is therefore subjected to strengthened obligations in terms of information, liquidity monitoring and risk management. The Board of Directors includes Grégory FRAPET as Chairman, Stéphanie LACROIX, Managing Director and Tristan MAHAUT, General Secretary.
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