Invesco Real Estate Advisers will benefit from its parent company’s global network as it explores the possibility of launching retail products in Germany and the UK
Amvescap’s acquisition of Parkes & Company has given the investment adviser a wider base from which to leverage its expanding European activities. For founder Gerald Parkes, the transition of the highly-regarded niche company to Invesco Real Estate Advisers (IREA), allows it to tap into the client base and capital raising abilities from Amvescap’s institutional and retail clients, which include the Invesco and Perpetual brands. Amvescap is represented in 32 global locations.
Before Parkes, Invesco was only active in real estate in the US through Invesco Realty Advisors (IRA), which has $6bn of assets under management. IRA advises institutional clients for separate account work on both the direct investment activities and real estate securities.
Parkes is keen to explore the possibility of creating products in partnership with Amvescap’s offices, particularly for retail investment vehicles. While IRA concentrates solely on institutional work, the Amvescap network offers retail products in other sectors.
Parkes says the most promising markets for such products would be the UK and Germany. “In Germany, we are talking to the client base about what they are looking for. We want to design products around what clients want.”
With the stock market and bonds looking less attractive relative to property, Parkes says there would be enthusiasm for retail products. However, it will be about creating the right product. For example, it is still difficult to design a tax-efficient instrument.
The move into retail products would be a shift in direction for IREA. The firm has been built up with two divisions: direct property advisory services and investment advisory services.
“The goal was to merge investments management skills with capital market skills,” says Parkes. Since inception, it has been involved with around $3bn of transactions and has $750m of assets under management.
On the direct property investment management side, IREA has built up with two main clients: Teachers Insurance and Annuity Association and Donaldson Lufkin Jenrette (DLJ). Teachers, which remains the company’s lower-risk profile investor, has invested around $1bn equity in Europe. IREA also continues to work on transactions for DLJ, which has a higher risk profile.
Both these clients are for non-discretionary contracts; with the Invesco network, IREA is keen to take on more discretionary contracts. It also anticipates cross-Atlantic capital flows.
The other side to IREA’s business is its investment advisory work. Recently, this has included advising on transactions, such as selling JP Morgan’s headquarter for Sumitomo Life and advising Irish Life on the sale of its minority stake in London property, Vinters Place, to Blackstone.
Much of IREA’s business has been in Spain, Portugal and France, and it has looked at deals in Italy and Germany. The company also has an office in Budapest. This office has been looking at the IREA’s first pooled fund, the Hungarian Retail Fund, which is exploring opportunities in central Europe.
The fund is understood to be negotiating to buy TriGranit’s holdings following TrizecHahn’s decision to withdraw from its European activities.
Invesco Real Estate
10 Mount Row
London
W1K 3SA
Tel 44 20 7543 3500
Fax 44 20 7543 3588
www.parkes.co.uk
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