Good start to the year for block residential real estate

Residential reaffirms its status as a countercyclical typology

For Nicolas Verdillon, Managing Director Investment Properties at CBRE France: “Like logistics, the residential asset class shows great resilience in the current environment. It is less subject than other typologies to rental risks for players seeking yield and it can be conducive to the creation of value for players favoring this strategy. »

After a market driven mainly by property dealers in 2023, profiles are diversifying at the start of the year with the return of institutional investors as well as private equity capital. Note, however, that social landlords and other public actors are responsible for more than a quarter of the volumes this semester, as part of their strategy for developing affordable housing, particularly in Île-de-France. These include both signatures of VEFA operations for intermediate housing and acquisitions of private housing stock, mainly via pre-emptions, intended to be transformed into approved housing.

A managed residential market driven by the continuation of regional networking by operators

Managed residential accounts for 20% of volumes in H1 2024 with nearly 312 million euros invested.

For Nicolas Verdillon: “Proportionally less represented in volumes than in 2023, the trends in this segment nevertheless remain the same as last year: investors continue to turn away from the senior market, and operators for student and coliving residences continue to expand into the territory by purchasing, for some, the walls themselves. »

In the 2nd quarter of 2024, volumes for managed residential were therefore mainly concentrated in the regions.

No slowdown expected for the last months of 2024

Great signings already identified for the end of 2024 should allow the residential market to continue its momentum. Furthermore, “the weak presence of international players in this typology and the acceptance of a lower risk premium with the bondholder make it a little less sensitive to the political and budgetary uncertainties which should weigh on the investment market this fall,” concludes Nicolas Verdillon. The postponement of certain bills to support construction or even concerning DPE could also delay the recovery of the housing sector in the medium term.

*including classic residential, intermediate housing, student residences, senior residences, coliving, intergenerational residences but excluding social housing.

Illustrative image of the article via Depositphotos.com.