European property group Patrizia closed over €3.5 bn of transactions in 2023, a nearly 50% reduction from €6.5 bn in 2022, in what it called a 'challenging market'.
Of the capital deployed in 2023, over a fifth (21%) was in the digitalisation of communities and smart city solutions through new fibre networks and broadband operators, while 20% was invested into the living sector that included major acquisitions of affordable and sustainable build-to-rent housing.
Over 11% of capital was deployed in the global energy transition via investments in Electric Vehicle (EV) charging, energy distribution and renewables, and nearly 10% was committed to real estate and infrastructure credit opportunities.
Alongside organic AUM development, Patrizia also invested in its existing real assets platform to position it for future growth. Its refurbishment and development programme amounted to €2.6 bn of projects (44% office and 37% living), while the group managed around €1 bn of additional value-add capex projects across its portfolio, which included the repositioning and solarfication of urban logistics in Germany.
In addition, nearly €3 bn of debt refinancing was secured within its real assets platform for flagship assets including the Commerzbank Tower in Frankfurt and the caverns energy storage facility in northern Germany, which is testing the safe large-scale storage of hydrogen.
Asoka Wöhrmann, CEO of PATRIZIA, said: 'Our economies and societies across the globe are experiencing fundamental shifts in the way people live, work and do business. In this world in transition, the most exciting and attractive investment opportunities will be unlocked by smart real asset players who have deep expertise in both real estate and infrastructure. While the market remained challenging in 2023, we successfully invested in attractive sectors underpinned by the long-term market transitions, we diversified our global real assets platform to make it even more resilient, and we continued to generate value for our global clients as an active investor in our long-term core markets.'
Investment trends in real assets
Throughout FY23, more than 80% of all transactions were acquisitions or new investments. Total transaction volumes were split across real estate (55%) and infrastructure (45%), with around 25% of all deals closed in the US and APAC markets, significantly expanding the international reach of the group’s investment platform.
For Patrizia’s real estate business, the most active markets for transactions were Germany (35%), Iberia (15%), UK&IE (12%), Benelux (10%), and the Nordics (10%).
