France's Scor targets €300m of equity for new debt fund

French asset manager Scor Investment Partners is targeting €300 mln of equity commitments for its second debt fund, Scor Real Estate Loans II, the firm's head of real estate debt Gilles Castiel has told PropertyEU.

'We have already raised €200 mln with the first closing in September,' said Castiel, who joined Scor in 2013 after eight years in charge of real estate debt in Paris for German lender Eurohypo.

'We have also closed our first investment for Scor Real Estate Loans II, which has the same value-add risk profile as Fund I.' Details of the transaction were confidential, he added.

Scor Real Estate Loans II will focus on loans of 3-5 years with margins over 250 basis points and securitised against office, retail or hotel assets offering development, repositioning or value-add potential mainly in the Paris area (at least 60%).

At least two-thirds of the properties should have environmental certification, noted Castiel. 'We see growing polarisation in the French real estate market, particularly in terms of valuation and rental level, between green buildings and the rest of the property stock.'

Scor Investment Partners is the portfolio management unit of Scor, the fifth-largest reinsurer worldwide, with €18 bn of assets under management. Founded in May 2009, Scor Investment Partners decided in 2012 to open part of its investment strategies to third party institutional investors. It currently manages €1.4 bn of assets for third parties.

The company launched its first real estate debt fund with €250 mln of equity at end-2013. That vehicle is currently fully invested, with clients including renowned firms including Belgian developer Codic, French builder Apsys and Altarea's Altafund.

'We feel development financing is part of a market in which we can still find good margins,' commented Castiel. 'We do not expect any sudden increase in the number of players active in this arena in the foreseeable future. German banks are only marginally interested in providing these loans and the US or UK banks are not in the game yet. I don’t see the situation changing in the near future.'

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By Virna Asara
France & Southern Europe correspondent