UK players take early lead in dealmaker rankings

M&G Real Estate and L&G Property – investors linked to two major UK insurers – have taken an early lead in PropertyEU’s provisional ranking of 2014 top dealmakers in European real estate.

Their strong showing is based on 2014 transaction activity reported publicly by 13 investors up to 26 January. A fuller picture will be published in March this year in PropertyEU’s survey-based Top Investors rankings and profiles.

Legal & General Property (LGP), part of insurance group Legal & General, has reported the largest volume to date as it increased its activity significantly last year compared to 2013. Ranked in 8th place in March on a volume of €3.2 bn, LGP announced on 7 January that it had completed over £4.1 bn (€5.3 bn) of property transactions in the UK market alone in 2014.

M&G Real Estate, part of insurance group Prudential PLC, said it carried out some £3.8 bn (almost €4.9 bn) of property transactions during 2014. This is significantly up on its 2013 volume of €3.95 bn which led to M&G Real Estate being ranked in fifth place in our dealmaker ranking last March. During 2014, more than £3.2 bn of property assets, with an average deal size of £50 mln, were acquired or committed to - around two-thirds of which were achieved off-market. In the same period, M&G Real Estate disposed of 73 holdings to realise more than £590 mln in cash. M&G rounds off the total reported volume of more than £3.79 bn to around £4 bn.

By contrast, Patrizia Immobilien, the German listed investor and consortium-builder which was ranked third in 2013, saw an 11% drop in transaction activity to €4.1 bn in 2014 from €4.6 bn in 2013. Investment volume was down €700 mln but disposals rose from €500 mln in 2013 to €700 mln last year. While acquisitions were down, Patrizia pushed into and deepened its presence in new markets last year by acquiring €1.8 bn of residential and commercial real estate in other European markets. This was over 2.5 times the non-German volume of €500 mln in 2013.

German fund managers Union Investment Real Estate and Deka Immobilien both reported a strong uplift in deals over 2014. Hamburg-based Union Investment carried out €3.5 bn of transactions, up 30% on the 2013 volume of €2.6 bn which resulted in 12th place in the last ranking. Deka Immobilien, ranked 14th with almost €2.5 bn of deals in 2013, said it transacted €3.4 bn last year. This comprised €2.1 bn of acquisitions and €1.3 bn of disposals. However, some of the deals took place outside of Europe.

The 13 players which have so far reported investment volumes for 2014 are only a small portion of the hundreds of investors invited to take part in our dealmakers’ survey. Nevertheless, they were responsible for a total volume of €33 bn between them - €23.7 bn in acquisitions and €9.5 bn in disposals.

Cormac Mac Ruairi
Senior editor