The share markets of corporate real estate SCPI and “consumer” OPCI at 1st quarter 2018: an inflow meeting expectations
After an exceptional inflow at the first semester of 2017, the return to normality initiated at second semester 2017 is confirmed at first quarter of 2018. This reflects a willingness of managers to remain in control of the speed of acquisitions to maintain the performance of their portfolios. ASPIM and IEIF have published for the very first time their statistics on a fiscal quarter.
Inflow levels similar to 2016
“After an exceptional first quarter in 2017, notably driven by needs of some companies having made record high acquisitions, levels of inflow are similar to those observed at the first quarter of 2016. This trend shows a healthy return to the norm for management companies concerned about maintaining attractive returns by protecting themselves from the temptation of making quick acquisitions” states the President of ASPIM, Frédéric Bôl. “This return to moderation should help to consolidate the performance of vehicles and to confidently consider the market prospects.”
Despite an unfavourable regulatory environment
Wrong regulatory signals have also contributed, to a smaller extent, to prompt managers to be restrained. The announcements on the property-based wealth tax (IFI) and the anticipation, which was proven correct, of administrative complexities linked to tax declaration, are part of it. Morever, new constraints related MIF2 (Markets in Financial Instruments) and PRIP (produits d'investissements auprès des particuliers / investment products aimed at private individuals) directives require a less intuitive presentation of products on commercial documents. “In addition to the commercial strategy of managers, the impact of new regulatory constraints has contributed to the lull. The confusion surrounding the first IFI tax declaration has notably generated apprehension on all the actors.” adds Frédéric Bôl who reminds that ASPIM continues to report the case for considering SCPI and OPCI in the tax base “Who could pretend that investing in offices, retail businesses, hotel businesses, accommodation for students or nursing homes would lead to anything else than a productive economy?” he asks.
If some regulatory factors have contributed to the confirmation of the slowing down initiated at the second semester of 2017, the risk of excess inflow is today avoided, which offers sustainable growth prospects to a sector in which the good health of fundamentals allows to envisage the future with confidence.
Net inflow
- Corporate real estate SCPI
During the first quarter of 2018, more than two thirds of corporate real estate SCPI increased their capital for an overall net inflow of 1.141 billion euros. Over the past twelve months, the corporate real estate SCPI have had a total inflow of 4.488 billion euros.
- OPCI retail
The net inflow of the 14 OPCI retail reached 438 million euros over the course of the first three months of 2018 fiscal year.
Over the last twelve months, the OPCI retail made a total inflow of 2.995 billion euros.
In total, the cumulative net inflow of corporate SCPI and OPCI retail reached 1.579 billion euros during the first quarter of 2018.
Overall asset
- Corporate real estate SCPI
The corporate real estate SCPI capital reached an all-time record of 47.282 billion euros on 31 March 2018.
- OPCI retail
The OPCI retail capital went up to 13.469 billion euros on 31 March 2018.
On 31 March 2018, the cumulative capital of these two major categories of unlisted real estate funds aimed at private individuals went up to 60.751 billion euros, representing an increase of +2.5% over three months.
Secondary market
228.2 billion euros have been traded in the first quarter of 2018 on the secondary market of corporate real estate SCPI shares, which corresponds to an exchange rate of shares of 0.49%. The combined shares pending transfer and uncompensated retirement is limited at 0.30% of the capital, a very small increase compared to the previous quarter (0.22% at the fourth quarter of 2017).
The corporate real estate SCPI were representing 92% of the capital and 97% of the net inflow of 2017 of the entire SCPI.