"Investment in real estate to be doubled over the long-term"

Olivier Piani: Real estate belongs to the class of long-term investments. It offers a stable, continuous return and relatively low volatility as well as little correlation to other asset classes.  In addition, real estate offers possibilities for increasing the value of investment and so is useful in building of reserves. So real estate really plays a key role in our investment mix.

Olivier Piani, CEO Allianz Real Estate

Piani: In order to avoid clumping in regional markets, we are diversifying our portfolio based on geographic location. We also try to have a healthy balance of retail and office  properties and of direct and indirect investments within our real estate portfolio. Finally, part of an active buy-and-sell strategy is not only taking advantage of attractive offers to buy, but ideally also selling at a time when we can make a return on our investments. In fact Allianz's sale of properties does not contradict anything. We are simply fulfilling our strategic objectives.

Piani: Allianz plans a significant expansion of its real estate portfolio in the coming years. Worldwide it should grow from the current 17 billion euros of assets under management to a maximum of 30 billion euros. This would increase the real estate portion of  the total Allianz portfolio to 6 percent from 4 percent, as it stands today.

Piani: Allianz Real Estate wants to have a widely diversified portfolio and, of course, we are also paying attention to the risk/return aspect. We are especially interested in acquiring office and retail properties, which are rented out completely and over an extended time period. Ideally these properties are located in top urban areas of selected cities. The retail portion of the portfolio should be continuously expanded. Our emphasis is on the Euro zone but we are also considering new investments in certain American and Asian markets. The volume of investment per property ranges from about 50 to 100 million euros. At higher volumes co-investments and joint ventures with strong partners are preferred. Mainly direct investments are made, however, in certain markets and for special use properties (e.g. logistics) indirect investments as well.

Piani: In recent years a global platform for real estate investment and asset management was build up in the form of Allianz Real Estate. On the basis of a return/risk oriented portfolio management strategy, investments in real estate are managed professionally, according to uniform criteria. The Allianz Real Estate Holding makes up the strategic roof under which the various national entities, which are responsible for carrying out the operative portion of our investment and asset management businesses in their local markets, are grouped. Currently Allianz Real Estate has offices in Munich, Paris, Frankfurt, Berlin, New York and Singapore.

Piani: Since the beginning of 2010, Allianz Real Estate has made new investments of about 1.6 billion euros. The focus was on office and retail properties. The Allee Shopping Center in Budapest, the St. Quentin in Paris, the Porta di Roma in Rome -  Italy's largest shopping center, the Beursgallery in Rotterdam as well as a real estate portfolio from Aldi are among the retail acquisitions. Office space was purchased in Paris, Munich, Dusseldorf and Frankfurt. Further transactions will follow shortly.

 
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