Ernst & Young publishes asset management study. The result: Residential real estate is increasingly in demand by institutional investors.
Since 2016, Ernst & Young has yearly published the asset management study. In 2019, Ernst & Young together with Venovia interviewed 40 companies on their assessment of opportunities, risks and developments in the real estate industry. The main focus of the study was on how asset management will develop over the next few years.
The survey shows that, above all, real estate is increasingly in demand as an investment. In the near future, 90 percent of the surveyed asset managers stated that they were primarily looking to acquire more residential property and, moreover, set a longer holding period with a minimum of eight years. 82 percent of respondents said that residential real estates already accounts for a significant amount of their portfolio, and that these are primarily located in the top seven German locations. Only 56 percent said they managed assets in the form of office properties. A much smaller share was accounted for by commercial real estate (38 percent).
Almost all respondents (96 percent) also agreed that the requirements on real estate asset management are changing at the time and that more know-how is needed than a few years ago. The reason for this is primarily the increase in mixed-use real estate, like buildings that offer, for example, both residential units and commercial units, offices or parking facilities.
In the future, 82 percent of asset managers would place a major focus on project developments. 79 percent agree with the statement that they want to expand their performance in the area of investment management. While 69 percent want to concentrate on the development of wastelands, 67 percent see their focus in the densification and reinforcement of existing real estate. After all, almost half of the respondents envisage modernisation and conversion from commercial to residential space.