AXA Investment Managers - Real Assets (AXA IMRA) announced on Friday that it completed €13.7 bn of transactions on behalf of clients in 2019 and raised €8.6 bn of new capital over the course of the year.
Over the past 12 months the company completed three acquisitions involving listed entities, including the €1.1 bn take-private acquisition of NYSE listed Northstar Realty Europe. Innovatively structured transactions were also completed alongside listed retail property specialists, Hammerson and Eurocommercial Properties, providing AXA IM - Real Assets with significant stakes in two prime retail assets in trophy locations in central Paris. The deals signify AXA IMRA’s strong conviction on the opportunity to secure prime retail properties in core urban markets at a time when the overall retail environment is experiencing challenges, the company said.
The alternatives sector remains a key growth driver for AXA IM - Real Assets, accounting for more than two-thirds of the real estate equity acquisitions completed during 2019. The focus remains on asset classes that are supported by clear demographic and structurally-driven growth drivers.
AXA IMRA continued investing in operationally-focused alternative platforms such as Groupe Kley, a fully integrated student housing and co-living operator with a portfolio of student residences across France. It also entered the Australian student accommodation market, where it has partnered with student housing operator and manager, Scape, to acquire two separate portfolios totalling 10,315 beds.
A total of €1.7 bn was directed towards residential asset classes during 2019, expanding the global residential portfolio to €18 bn, while AXA IM - Real Assets reinforced its portfolio of properties dedicated to the private rental market with €1 bn of additions, comprising both development projects and standing assets presenting opportunities to add value. Existing market positions were consolidated through new acquisitions in Japan, Spain, Ireland, the Netherlands and the Nordic region, while attractive new rental markets, including Portugal, were also entered for the first time during the year.
John O’Driscoll, European head of Transactions at AXA IM - Real Assets, commented: ‘AXA IMRA stood out in a highly competitive environment through its ability to leverage the diverse skillset across the platform. This facilitated the execution of a number of large, high profile and complex transactions, which were frequently sourced off-market. We further showcased our willingness to invest in operational platforms during 2019, particularly in alternative asset classes(2), to access the most attractive opportunities for our clients whilst gaining exposure to highly scalable businesses and experienced management teams.’
A total of €8.6 bn in new capital was raised from international investors including 31 new third-party clients. Adding to additional sources of capital from historical markets, 2019 saw AXA IM - Real Assets enter or significantly expand its presence in some of the largest institutional markets, including Japan, South Korea, the Netherlands and the Nordics.
A notable proportion of new capital raised was committed to AXA IMRA’s renewed open-ended funds range, whether pan-European diversified or sector focused, such as logistics, as well as to large debt mandates, targeting both real estate and infrastructure strategies. The flagship Core Pan-European strategy saw an acceleration of its growth, more than doubling assets under management to reach €4 bn at the end of the year.
Florence Dard, global head of Business Development at AXA IM - Real Assets commented: ‘We have had another successful year in terms of raising capital, from an increasingly diverse pool of investors, which underlines the continued appeal of the real assets sector as well as the suitability of our product offering.’