Powering growth in the next cycle
PATRIZIA CEO Asoka Wöhrmann takes stock of the trends and opportunities in the real assets sector in the new market cycle, explaining PATRIZIA’s focus on five key growth areas which will drive the company’s activity up until 2030.
A hush fell across mission control at SpaceX. Then the bottom half of the rocket manoeuvred itself back into its launch tower and suddenly, the employees cheered excitedly. The likelihood of this happening on the first attempt, thereby bringing SpaceX’s ambition of developing a fully reusable and rapidly deployable rocket a step closer, was very slim. And yet, they pulled it off.
As Nelson Mandela once said:
“It always seems impossible until it’s done.”
This entrepreneurial spirit, framed through SpaceX’s successful mission in October last year, is something which has been present throughout PATRIZIA’s 40-year journey from a German residential real estate firm to a c. EUR 56 billion AUM global investment manager for real assets. Mandela’s immortal phrase is a favourite of PATRIZIA Founder Wolfgang Egger’s which all PATRIZIAns at some stage of their journey will have become familiar with.
Last year, we shared our new mid-term strategy to become the go-to manager for smart real asset solutions with an AUM ambition of EUR 100 billion by 2030. Our new strategy is inspired by the same entrepreneurial ambition which has been at the heart of PATRIZIA since its founding back in 1984. However, the world has changed dramatically in the last five years. We live in a world in transition and are entering a new growth cycle that is significantly different from previous cycles.
This supercycle is driven by four DUEL megatrends – digitalisation, urbanisation, energy transition and modern living. All these four megatrends are powered by technology. Just look at artificial intelligence (AI). The race is on. Experts believe that AI will exceed the intellectual capabilities of humans in the next 5-10 years. In fact, AI is already impacting all industries including the real asset industry. AI will drive the ‘smartness’ of real assets, and this will become a key differentiator for value generation in the future.
Central to our mid-term strategy are our five key growth areas: European infrastructure, living, value add, RE-Infra solutions and our multi-manager platform Advantage Investment Partners (AIP). We believe these five areas will propel PATRIZIA’s growth momentum forward in the next five years.
RE-Infra - the ‘first mover’ innovation play
Each of our first three growth areas is firmly established in the world of real assets. But we see an emerging trend of the convergence of real estate and infrastructure investments. We call this emerging segment our ‘RE-Infra’ growth area.
Already a decade ago, we identified the need to incorporate infrastructure into our platform to grow our real assets capabilities and portfolio. In 2022, we acquired independent infrastructure investment manager Whitehelm Capital and significantly broadened our portfolio. Since then, many other global investment managers have made similar moves, such as the notable acquisition of Global Infrastructure Partners (GIP) by Blackrock in 2024.
‘RE-Infra’ is not only an emerging asset class but very much driven by technology. Technology is a key enabler of smart cities solutions. For example, our Italian streetlighting platform is not only creating the conditions for streetlights in cities, but also using them for purposes such as electric vehicle charging stations and solar panels.
RE-Infra investments are an innovation play – one in which we invite our clients to join us as first movers in this space. We did something similar in 2018 when launching the Smart Cities Infrastructure Fund, which was the first fund of its kind. And we are confident that we can quickly and successfully integrate RE-Infra as a core part of our growth ambition.
AIP
- the investment club diversification play
Like RE-Infra, our fifth growth area is not well known by our client base. In 2022, we acquired AIP – a multi-manager platform based in Copenhagen.
As part of the acquisition rationale, AIP is designed to run as a standalone business line to attract a much broader client base with the ability to invest in other competitive products as well. But at the same time, AIP is also part of the PATRIZIA universe. Investors benefit from our multi-manager approach to strengthen the diversification of their portfolios. And the direct access to General Partners (GPs) provides them with better net returns from more competitive fees.
billion AUM
AIP’s growth story to reach EUR 2 billion AUM has already been hugely impressive and we see this platform gaining more momentum in the current cycle. Rather than see multi-manager platforms as a threat, we can better serve our clients’ needs to diversify their investment risks and maximise their returns. And PATRIZIA will continue to benefit from the excellent performance attained by this complementary investment platform.
Getting ready for lift-off
Our five growth areas are at the heart of our EUR 100 billion AUM growth ambition by 2030. We are excited to drive the execution of our growth ambition in the new investment cycle. By delivering in every growth area, we can create better synergies and risk-return profiles across our entire product portfolio and thus generate more attractive investment opportunities for our clients.