Business models will change following implementation of AIFMD

The business models of European real estate fund managers will change following the implementation of AIFMD, according to Matthias Thomas, CEO of the European association of non-listed real estate vehicles INREV.

‘It will be more difficult for new fund managers to enter the market. There will also be a greater distinction between parties that play an advisory role and conduct asset management for example and those that perform risk management and ensure compliance with regulatory issues,’ he said. ‘It may even be cheaper for some institutional investors to internalise their risk management processes.’

Thomas made the comments during an interview at the Expo Real fair in Munich on Monday. A recent survey carried out by INREV revealed that 85% of respondents expect the costs of implementing AIFMD will be significant, he noted. ‘Fund managers will bear 54% of the costs and investors the remainder.’ In total, more than 60% of the respondents are planning to apply for authorisation within the next six months, he added. ‘The challenge is that there is still lack of clarity in some countries about implementation, but overall it does appear that that the industry is coping.’