Axa reallocates real estate capital outside France

Europe’s biggest real estate investor, AXA Real Estate, is reallocating capital outside France on behalf of its major shareholder AXA Group, PropertyEU Magazine reports.

The 50-50 joint venture signed recently between AXA Real Estate and Norwegian pension fund manager NBIM is in line with the strategy of the French insurance arm of the AXA Group to reduce its exposure to large Paris office properties and create a more geographically diverse portfolio in Europe, according to Pierre Vaquier, CEO of AXA Real Estate. 'The joint venture will allow AXA France Insurance Companies to reallocate capital and diversify into other European markets, especially the UK and Germany, while maintaining exposure to this important market by retaining a significant stake in the joint venture. We will continue to manage the portfolio and look forward to working with Norges Bank in this exciting partnership.'

Vaquier said AXA Group had a strong desire to diversify its EUR 21 bn real estate portfolio ahead of the introduction of new capital requirements under Solvency II. 'AXA doesn't want to have all its eggs in the same basket. We're keen to invest in shopping centres - although they are quite expensive now - and office markets in the big cities in Europe. We are pursuing a barbell strategy: the only way to make opportunistic investments is by developing them yourself. We don't see the banks making any moves at the moment to re-price their assets which are under water.'

AXA Real Estate has a long tradition in development. Indeed, six of the seven assets in the portfolio sold to NBIM (Norges Bank Investment Management) were developed or redeveloped by the insurer’s property arm. In the past decade, the development team has completed more than 250 projects with a combined value in excess of EUR 8 bn, including more than 15 major corporate headquarters.

The full interview with AXA Real Estate appears in the September edition of PropertyEU Magazine. Click on the link below to subscribe