Harald Berlinicke, CFA 🍵

Scope Analysis surveyed 53 investment companies on “Liquid Alternatives”. The results show that around 90% of respondents believe these funds have “very good” or “good” sales potential in 2017.

Liquid alternatives, a relatively young class of funds, continue to be popular. Demand has risen sharply in recent years, and in response so has the supply. The number of legally authorised funds has doubled during the past five years, and Germany currently has 700 of them. In 2005, only 21 such… Mehr anzeigen

Scope Analysis surveyed 53 investment companies on “Liquid Alternatives”. The results show that around 90% of respondents believe these funds have “very good” or “good” sales potential in 2017.

Liquid alternatives, a relatively young class of funds, continue to be popular. Demand has risen sharply in recent years, and in response so has the supply. The number of legally authorised funds has doubled during the past five years, and Germany currently has 700 of them. In 2005, only 21 such funds were authorised for distribution.

Assets under management currently total EUR 340bn. For 2017, Scope Analysis expects a significant increase in net inflows, attributed in large part to the ultra-low interest rates that have forced investors to look for alternative sources of return.

Scope analysts also expect the number of funds to grow this year – although not as much as in previous years. The main reason is that the bulk of issuers have already launched liquid alternative funds. As a result, capital inflows this year will focus more existing products.

Stronger growth in liquid alternatives has been accompanied by a greater range of investment approaches and strategies. This has led to a wider performance spectrum on the market, making it more challenging for investors to select strategies, managers and funds. Weniger anzeigen

Alternative investments and AIF: Scope Analysis gives its outlook for 2017

Alternative investments will remain the focus of investors in 2017. Attainable returns for real assets will still outperform government-bond yields. But not all asset classes will benefit equally from investors’ interest.

Real estate – positive outlook

The US property market in 2017 will continue to benefit from fundamental developments, despite political uncertainties. German real estate assets will… Mehr anzeigen

Alternative investments and AIF: Scope Analysis gives its outlook for 2017

Alternative investments will remain the focus of investors in 2017. Attainable returns for real assets will still outperform government-bond yields. But not all asset classes will benefit equally from investors’ interest.

Real estate – positive outlook

The US property market in 2017 will continue to benefit from fundamental developments, despite political uncertainties. German real estate assets will remain popular, and Scope does not expect a housing bubble. For investors, the situation for UK real estate is better than that initially feared after the Brexit vote, and this perception will continue into 2017.

Renewable energy – slightly negative outlook

The uncertainties around feed-in tariffs have particularly dampened an otherwise positive outlook; but the growing use of long-term power purchase agreements with creditworthy commercial customers is limiting risk. Going forward, Scope expects renewable energy producers to focus on selling directly to commercial or industrial users.

Aviation – slightly negative outlook

Global load factors in aviation continue to be high, although the first signs of overcapacity in Asia are emerging. Growth in passenger kilometres has slowed overall. Market values for aircraft have fallen, along with attainable lease rates, but this development should not lead to financing gaps.

Shipping – stable outlook

The industry continues to break down overcapacity in container shipping. At the same time, the order book has reached the lowest level since 1999. Scope expects consolidation to continue. Many segments have finally reached a turning point after many years of crisis.

Open-ended and closed-end alternative investment funds – differing developments

[see publication for more details] Weniger anzeigen

Scope assigns Commerzbank AG a first-time certificate issuer rating of AAA (ZMR)

The agency rates Commerzbank AG’s quality and competence as an issuer of investment certificates (including leveraged products) on the secondary market as excellent.

Commerzbank AG has a long and proven history as an issuer of retail investment certificates – since 1995 – and benefits from its very experienced management team, whose company tenure is considered above average. The wide product range is… Mehr anzeigen

Scope assigns Commerzbank AG a first-time certificate issuer rating of AAA (ZMR)

The agency rates Commerzbank AG’s quality and competence as an issuer of investment certificates (including leveraged products) on the secondary market as excellent.

Commerzbank AG has a long and proven history as an issuer of retail investment certificates – since 1995 – and benefits from its very experienced management team, whose company tenure is considered above average. The wide product range is the best in the industry: around 200,000 products with about 1,200 underlyings.

The rating is supported by the bank’s exceptional IT system, which allows a high standard of trading and the most flexibility for new issuances, for example, as demonstrated by the high volume of intraday issuances. The bank performs especially well for the research, training and tools it provides for customers, and also for its website, which has the option of German or English. Customers can also access information via a well-designed certificates app, which offers the same functions as the website while providing a high degree of user-friendliness.

In Scope’s view, the rating is constrained by the loss in market share over the last 12 months, at around seven percentage points, which is attributed to the decline in trading volumes on the Stuttgart and Frankfurt exchanges. In the last 24 months, Commerzbank could at most only hold its market share steady, with the same applying for its ranking by traded volume on the stock exchanges. Notwithstanding, certificates can also be traded directly with the issuer (over the counter). Although there are no official statistics on these over-the counter trades, Commerzbank’s data shows that these trades can partly offset the loss in its exchange-traded market share. Weniger anzeigen

Scope’s Certificate Management Rating is a subset of its long-established Asset Management Rating for alternative investment managers. This rating assesses the quality of a certificate-issuing company in its role as a product manager and issuer. The Product Quality Rating (PQR) assesses the quality of investment certificates of a particular issuer within a specific product
category, such as discount certificates, credit-linked notes.

Scope stuft das Asset Management Rating der PROJECT Investment Gruppe auf AA- (AMR) herauf

Scope bescheinigt der PROJECT Investment Gruppe damit eine sehr hohe Qualität im Asset Management von Immobilien.

Die im Jahr 1995 gegründete Unternehmensgruppe ist der führende Anbieter von geschlossenen deutschen Wohnimmobilienentwicklungsfonds mit 25 aufgelegten Fonds, einem platzierten Eigenkapital in Höhe von 500 Mio. Euro und rund 400 Mitarbeitern an acht Standorten in Deutschland und… Mehr anzeigen

Scope stuft das Asset Management Rating der PROJECT Investment Gruppe auf AA- (AMR) herauf

Scope bescheinigt der PROJECT Investment Gruppe damit eine sehr hohe Qualität im Asset Management von Immobilien.

Die im Jahr 1995 gegründete Unternehmensgruppe ist der führende Anbieter von geschlossenen deutschen Wohnimmobilienentwicklungsfonds mit 25 aufgelegten Fonds, einem platzierten Eigenkapital in Höhe von 500 Mio. Euro und rund 400 Mitarbeitern an acht Standorten in Deutschland und in Wien/Österreich. Das Immobilienentwicklungsportfolio umfasst derzeit 63 Projekte an sieben Metropolstandorten in Deutschland und Österreich mit einem Gesamtverkaufsvolumen von 1,4 Mrd. Euro, was einer Verdoppelung in den letzten drei Jahren entspricht. Seit geraumer Zeit erfolgt eine Beimischung von Gewerbeimmobilien, bei denen analog zum Kernbereich Wohnimmobilien die Abdeckung der gesamten Wertschöpfungskette erfolgt.
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Scope publishes current ratings and market study on open-ended property funds
Nine ratings adjusted – high inflows and high liquidity, scarcer products – funds go on the offensive – more complexity for asset management.

Scope Analysis has assigned ratings for all relevant open-ended retail property funds in Germany for private investors that have been in existence for at least one financial year, as well as selected funds aimed at institutional investors. In total, Scope has rated 14… Mehr anzeigen

Scope publishes current ratings and market study on open-ended property funds
Nine ratings adjusted – high inflows and high liquidity, scarcer products – funds go on the offensive – more complexity for asset management.

Scope Analysis has assigned ratings for all relevant open-ended retail property funds in Germany for private investors that have been in existence for at least one financial year, as well as selected funds aimed at institutional investors. In total, Scope has rated 14 retail funds, three institutional funds and one fund of funds. Scope’s market study gave the following main findings:

1. Nine ratings adjusted

2. Rising inflows, high liquidity, falling leverage

3. Occupancy rates remain high

4. Stronger investment focus on development projects

5. A Brexit would only affect open-ended funds later on

6. Outlook
For 2016, Scope expects cash inflows to exceed those of prior year, though the growth in net inflows will ease off slightly compared with Q1 2016. Right now, the biggest task for fund managers, also for this year, is moving the large piles of cash. Therefore, how well a fund manager deals with properties bought in a high-price period as soon as the markets cool, or how well they withstand a financial crisis, will be decisive. Well-located properties often see high fluctuations in market values and rents, but have the general advantage of high demand among tenants and potential buyers. In this regard, long-term contracts with very creditworthy tenants will build a solid basis for offsetting market fluctuations in future. The strategy of holding a highly liquid portfolio is also, in Scope’s view, important for ensuring an open-ended property fund remains sustainable. Weniger anzeigen

Scope updates Asset Management Rating methodology
New AMR methodology offers greater transparency by featuring a scoring system for asset managers.

Scope has further developed its Asset Management Rating methodology to address the greater need for transparency among investors and product managers. Scope meets this need by publishing its scoring system for assessing an asset manager – not just for metrics, but also for qualitative criteria. In addition to a management company’s… Mehr anzeigen

Scope updates Asset Management Rating methodology
New AMR methodology offers greater transparency by featuring a scoring system for asset managers.

Scope has further developed its Asset Management Rating methodology to address the greater need for transparency among investors and product managers. Scope meets this need by publishing its scoring system for assessing an asset manager – not just for metrics, but also for qualitative criteria. In addition to a management company’s organisational structure, financial strength and competitive positioning, Scope assesses and gives a score to all phases in the lifecycle of an asset manager’s investment. These phases range from research, development and technical/commercial activities, to exiting an investment, ensuring that segment-specific features are applied. Great importance is attached to the track record of the institution and the relevant professional experience of its personnel.

Download the updated methodology here.

About Scope Analysis GmbH
Scope Analysis GmbH, based in Berlin, is a company under the Scope Corporation AG group. The company specialises in the analysis and rating of asset management companies, derivatives, and alternative investment funds in the areas of real estate, shipping, aviation, renewable energies and infrastructure. Scope Analysis GmbH offers institutional investors opinion-driven and forward-looking analyses. This approach illustrates a product’s risk-return profile and, in particular, considers existing asset allocations, identifies growth potential and monitors risks on an ongoing basis. Scope Analysis GmbH can thereby support institutional investors in implementing innovative strategies to optimise portfolios.

Contact

Scope Analysis GmbH Phone: 49 (0)30 27891-0
Harald Berlinicke [email protected]
Sven Janssen [email protected]
Nadine Wittke [email protected] Weniger anzeigen

Scope continues to have a favourable outlook on debt funds, both for funds that invest in commercial real estate as well as in other assets, particularly infrastructure, direct lending and structured credit tranches.

Persistently low interest rates have resulted in institutional investors struggling to find fixed-income assets that can meet their yield requirements. However, Scope’s macro view of the eurozone as constructive means debt funds should continue to perform well. In this… Mehr anzeigen

Scope continues to have a favourable outlook on debt funds, both for funds that invest in commercial real estate as well as in other assets, particularly infrastructure, direct lending and structured credit tranches.

Persistently low interest rates have resulted in institutional investors struggling to find fixed-income assets that can meet their yield requirements. However, Scope’s macro view of the eurozone as constructive means debt funds should continue to perform well. In this regard, Scope Ratings sees a number of supportive factors – low oil prices and the depreciated euro especially, with the former pushing up households’ disposable income while decreasing production costs for businesses; and the latter boosting exports.

The ECB has also confirmed it will extend its ultra-accommodative monetary policy beyond 2016. These positive factors should offset external risks posed by both geopolitical aspects and the slowdown in emerging markets; and offset internal risks owing to the refugee crisis and political instabilities.

Against this backdrop, many investors have started their homework on debt funds. And given the spike in debt fund issuances during 2012, most European debt fund managers achieved a three-year track record for the first time in 2015, which should also help investors who had previously put off taking a decision.

In Scope’s view, investors are well advised to query asset managers in terms of sufficient resources for the monitoring and workout of deals, as well as in terms of layered risk in the yield pick-up strategies pursued for the portfolio.

To download the full report: https://www.scoperatings.com/research/details?ID=151566&lC=EN

Contact

Scope Ratings AG Phone: 49 (0)30 27891-0
Harald Berlinicke [email protected]
Stefan Bund [email protected]
André Fischer [email protected] Weniger anzeigen

European real estate debt funds continue to grow – but face tougher competition in buying assets

Scope Ratings sees 2015 on track to be record-breaking for European real estate debt funds with the number of funds and target capital raising by mid-year 2015 already above the 2013 full-year record.

With 53 funds and an aggregate target capital of EUR 33.6bn as of June 2015, growth of European real estate debt funds has kept its momentum since late 2012. The positive market reception… Mehr anzeigen

European real estate debt funds continue to grow – but face tougher competition in buying assets

Scope Ratings sees 2015 on track to be record-breaking for European real estate debt funds with the number of funds and target capital raising by mid-year 2015 already above the 2013 full-year record.

With 53 funds and an aggregate target capital of EUR 33.6bn as of June 2015, growth of European real estate debt funds has kept its momentum since late 2012. The positive market reception of real estate debt funds is also reflected in strong placement volumes for funds since 2011, with most vintages showing actual placement volumes exceeding target levels.

The two most prominent reasons for the strong demand are: institutional investors’ ongoing hunt for yield in a painfully low interest rate environment; and a favourable amendment in the regulatory framework for institutional investors in Europe. In particular, the currently strong demand for debt funds among German insurance companies and pension funds can be explained by changes in the German insurance supervision law (Versicherungsaufsichtsgesetz - VAG).

European real estate debt funds have gone from strength to strength over recent years with growth driven by both the asset and liability sides in funds. However, Scope predicts this to be a slowing trend. While demand for real estate debt funds is expected to remain high or even increase further, increased liquidity in Europe’s commercial real estate lending markets will intensify competition for assets, making it harder to source assets suitable for meeting investor’s risk-return profiles. To stay ahead of the curve, real estate debt fund managers need to demonstrate flexible and innovative lending strategies, as well as operational strength, to put available money to work efficiently. Weniger anzeigen

Scope publishes updated debt fund rating methodology

Proposed methodology update clarifies and simplifies the rating approach, focusing on the credit quality of the debt funds' investment portfolio.

Scope Ratings today published its revised Rating Methodology for Debt Funds. It will replace the methodology published under call for comments in August 2014.

The debt fund methodology describes Scope’s analytical approach to rating and monitoring of debt funds' average credit… Mehr anzeigen

Scope publishes updated debt fund rating methodology

Proposed methodology update clarifies and simplifies the rating approach, focusing on the credit quality of the debt funds' investment portfolio.

Scope Ratings today published its revised Rating Methodology for Debt Funds. It will replace the methodology published under call for comments in August 2014.

The debt fund methodology describes Scope’s analytical approach to rating and monitoring of debt funds' average credit quality, expressed as the funds' expected loss over its weighted average life. The rating takes into account general characteristics of individual assets and the portfolio as a whole. For portfolios where the manager has discretionary trading capabilities, Scope will consider the current or deemed Asset Management Rating (AMR) of the debt fund manager.

In response to market feedback, Scope now concentrates its rating on the average credit quality of the portfolio, taking into account a fund's investment and eligibility criteria as well as the asset manager' capabilities.

The updated Debt Fund Rating Methodology is available by clicking on the link or at www.scoperatings.com.
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