Industry Newsletter ISSUE 60 SEPTEMBER 2017 CLICKS N’ BRICKS. HOW RETAIL Interview IS CHANGING with Page 7 REFORMING SOLVENCY II FOR INSURERS Grainger Page 14 RAISING CAPITAL MORE CEO CREATIVELY Page 21 JAPAN PSP Swiss Property Safestore NN Investment Partners Swiss Prime Site Schroders University of Geneva SEGRO LUXEMBOURG Members list Shaftesbury UAE ADO Properties Standard Life Investment Abu Dhabi Investment Authority Dream Global REIT Stenprop As of August 2017 Emirates REIT Grand City Properties Target Healthcare REIT NETHERLANDS UNITED KINGDOM Tritax Big Box REIT AEW Europe U+I Group AUSTRALIA Mercialys ABN AMRO AMP Capital UBS Société de la Tour Eiffel Amsterdam School of Real Estate Resolution Capital Assura Unite Group Société Foncière Lyonnaise APG Asset Management Westfield Aviva Investors University of Aberdeen Société Générale ASR Western Sydney University Bank of America Merrill Lynch University of Cambridge Atrium European Real Estate Unibail-Rodamco University of Reading, CRER AUSTRIA Barings Barclays Bank Université Paris-Dauphine Urban & Civic BUWOG Group Bouwinvest Barclays Capital Workspace Group CA Immo GERMANY CB Richard Ellis BDO Züblin Immobilien Conwert Immobilien Invest ADLER Real Estate CBRE Global Investors Europe Big Yellow Group Blackrock Asset Management IMMOFINANZ Allianz Real Estate Deloitte Financial Advisory USA Services BMO Global Asset Management S IMMO alstria Office REIT CenterSquare AroundTown Property EuroCommercial Properties (EMEA) British Land Cohen & Steers Capital BELGIUM DEMIRE ING Bank Real Estate Finance Management Capital & Counties Properties Aedifica Deutsche EuroShop Kempen & Co Dickinson College CBRE Clarion Securities AG Real Estate Deutsche Wohnen LaSalle Investment Management Duff & Phelps Citigroup Global Markets Limited Antwerp Management School DIC Asset Loyens & Loeff EII Capital Management CMS Ascencio* DO Deutsche Office MN Services Fidelity Management & Research Credit Suisse Securities Befimmo Hamborner REIT NSI Forum Partners Custodian REIT Care Property Invest HAWK University of Applied PGGM Neuberger Berman Sciences and Arts Derwent London Cofinimmo Redevco Europe Services Northstar Realty Europe Heitman Deutsche Alternative Asset DeGroof Petercam Tilburg University Real Foundations IREBS Management (UK) Intervest Offices & Warehouses University of Maastricht Deutsche Bank Russell Investment Group LEG Immobilien Vastned Retail Leasinvest Real Estate Ediston Property Investments Simon Property MEAG MUNICH ERGO Asset Wereldhave Retail Estates Management Empiric Student Property SNL Financial Yardi Solvay Brussels School PricewaterhouseCoopers EP&T Global University of Cincinnati WDP Real Estate Management NORWAY EY University of Washington* Xior Institute Entra GCP Student Living* Ventas Savills Fund Management Virginia Tech University BRITISH VIRGIN Norwegian Property GIC Real Estate TAG Immobilien Zell-Lurie RE Center at Wharton ISLANDS Globalworth* TLG IMMOBILIEN SINGAPORE Goldman Sachs International Eastern Property Holdings BPR LICENCE VIB National University of Singapore Grainger VictoriaPartners HOLDERS CANADA Great Portland Estates SOUTH AFRICA Allreal Vonovia Green Street Advisors Presima A&J Mucklow Group WCM Growthpoint Properties Hammerson CLS Holdings FINLAND Westgrund Hansteen Holding SPAIN CPI Property Group Aalto University Helical Bar GREECE Albirana Properties SOCIMI* Harworth Group Citycon Henderson Global Investors Grivalia Properties REIC Axiare Patrimonio Inland Homes KTI intu LAMDA Development Gmp Property McKay Securities RAKLI Invesco NBG Pangaea REIC Hispania Activos Inmobiliarios MRM Sponda Jefferies Inmobiliaria Colonial Northern Horizon Capital UB Real Asset Management HONG KONG JLL Lar España J.P. Morgan Orava Residential REIT University of Hong Kong Merlin Properties FRANCE Kennedy Wilson Europe Real Palace Capital Affine IRELAND URO Holdings Estate Regional REIT VBARE Iberian Properties Secure Income REIT ANF Immobilier Green REIT KPMG Landsec St. Modwen Properties AXA Real Estate Investment Hibernia REIT SWEDEN Managers* LondonMetric Property Terreis Irish Residential Properties REIT Atrium Ljungberg BNP Paribas MedicX Fund Qrf Castellum CeGeREAL ISRAEL Moody’s Investors Service Dios Fastigheter Eurosic Morgan Stanley Azrieli Group Kungsleden Foncière des Régions NewRiver REIT Gazit Globe Pandox Frey Nottingham Trent University SEB Gecina ITALY Phoenix Spree Deutschland Technopolis* Icade Aedes Picton Property Income Ltd Wihlborgs IEIF Beni Stabili Premier Asset Management* Ivanhoé Cambridge Europe Chiomenti SWITZERLAND Primary Health Properties Klépierre COIMA RES HIAG Immobilien Principal Global Investors Mazars Group IGD SIIQ Mobimo Holdings Redefine International *Welcome to our newest members the built environment; where we all live, the provision of better information Working with and work, shop and relax. They also play a to investors and stakeholders, active crucial part in providing retirement involvement in the public and political for our members security to millions of people, by debate, improvement of the general offering pension funds stable and operating environment, promotion of Real estate plays a critical role in all PAGE 1 highly competitive assets to invest in. best practices and the cohesion and aspects of our everyday lives. Property strengthening of the industry. companies serve businesses and EPRA’s mission is to promote, develop the society by actively developing, and represent the European public real Find out more about our activities on managing, maintaining and improving estate sector. We achieve this through www.epra.com ISSUE 60—SEPTEMBER 2017 IN THIS ISSUE Update from Dominique Moerenhout In the recent months, we have seen a At EPRA we embrace innovation and growing number of new companies with competition, however unsettling it may an alternative business model springing be. That is why we have made dealing Editor & Production up and entering the property market. In with uncertainty and change the Manager retail, office and even residential sector, centrepiece of our Annual Conference Kasia Jasik-Caínzos in September. We have an exciting line- it translates itself in a more flexible Article Credits customer-offering to reflect the ‘gig’ up of speakers, who will challenge the Mark Abramson economy. This development forces us way that we think about the real estate to re-think every aspect of our industry by exploring the economic, social, James Dearsley and the market leaders of tomorrow will political and technological changes Steve Hays be those that have successfully taken that are affecting our industry. Philippe Le Trung up the challenge. Simon Packard As a forward-thinking organisation Rogier Quirijns A consistent theme of EPRA’s Industry EPRA must also build on its successes Jonathan Tyler Newsletter is how the break-neck in anchoring listed property on the Design & Layout pace of technological change is investment landscape and use this ZN Consulting | znconsulting.com fundamentally reshaping the way we momentum to take the sector to the use real estate. Each edition of our next level. We believe that Europe’s Comments & Suggestions publication focuses on the challenges listed real estate sector is entering a [email protected] and opportunities facing specific new era of growth and the industry is sectors, drawing on our interviews well-placed to respond to the social EPRA with the CEOs of listed property and economic challenges of our time. Square de Meeus 23, 1000 Brussels companies. This month we examine To embody this dynamic, we are giving +32 (0)2 739 1010 how e-commerce is affecting retail real EPRA a new look and feel – from the www.epra.com estate, a particularly hot topic when we logo to a more user-friendly website. @EPRA_realestate consider what is occurring across the I welcome any feedback on our new Atlantic. branding. • In this 13 Retail sector 21 Raising capital issue snapshot more creatively 14 Reforming 24 A bumper year for 3 Interview with Solvency II for PropTech Grainger CEO insurers 27 Meet the EPRA 7 Clicks n’ bricks. 17 AMP Capital looks team How retail is to the North and changing South of Europe 29 10 strategic issues we cannot afford 10 Sephora focuses 20 Calling time on to ignore on ‘wow effect’ NAV PAGE 2 stores 30 Index focus INTERVIEW WITH GRAINGER CEO EPRA INDUSTRY NEWSLETTER Grainger CEO Helen Gordon sees service as foundation to prospects Grainger’s customer facing of UK’s business model “My mobile is never off and I put my PRS REIT to raise GBP 250 million in burgeoning number out there,” says the Chief Ex- an IPO in May. ecutive of Grainger, the UK’s largest listed residential property compa- “The UK PRS market has the poten- private ny which manages all its own assets. tial to be a market of scale. It’s our “People contact me on a Sunday morn- market and we know it well,” she said, ing or a Saturday afternoon and it’s on explaining her strategic plan, which the slightest detail. I get back to them involved the sale of Grainger’s resi- dential portfolio in Germany, assets in rented always. If our tenants are upset about the Czech Republic and its UK home something going wrong in their home, equity release business. “The new you have to be responsive.” residential strategy is very much about giving our Gordon describes the operational side shareholders total returns from capital of managing Grainger’s 8,600-unit appreciation and income. The income sector portfolio as her “biggest area of fo- side of residential has been ignored for cus” after restructuring