Gilles Emond
Head of Real Estate
Grupo Ageas Portugal

09 December 2021

Ageas is an international insurance group with activities in Europe and Asia. Its real estate subsidiary is the biggest real estate company in Belgium. In Portugal, Ageas has five insurance companies active and is working to increase it footprint in real estate, betting primarily on offices.

Ageas has a strong footprint across Europe and Asia, how does Portugal fit into the company's broader portfolio and what was your own journey here?

I made my way to Portugal three years ago to set up a strong and efficient team and build up our real estate portfolio. By the end of 2021 we will have more than ten core properties in our portfolio, including two headquarters we are finalizing in Lisbon and Porto. We are planning to increase the real estate allocation within the investment portfolio of our insurance companies in 2022.We are also planning to make some reallocation in our portfolio because we had some legacy assets - for instance we are in the process of selling a building in Porto.


The rotation of our portfolio is important - in the past many institutional investors were looking at buying assets and keeping them forever, but this is more a thing of the past. We prefer a more dynamic approach, we are willing to buy but also to sell.


In 2019 Grupo Ageas Portugal kicked off a EUR 150 million expansion. What asset classes are you prioritizing and why?

When we started in Portugal three years ago, we decided to move actively in two directions, the main one being offices. Why? Because there is really a lack of modern spaces here. After the financial crisis in 2010 there have been very few developments and the average quality is low to medium. On the other hand, you have an economy which is growing and many international companies willing to come to Portugal that have trouble finding suitable premises.

The second asset class we are going to develop is operational assets, meaning long term lease assets with tenants for whom the building is really an essential part of their business. I am referring to nursing homes, clinics, student accommodation etc. This means stable revenue and a good way to balance the more dynamic office investments.

In what ways did the global pandemic impact your business in Portugal?

We were already experimenting with the work from home model because we were preparing our move to the new office building, so in this sense we were lucky. But the business has seen some challenges. About 80% of Portugal's investment comes from abroad - since people weren't able to travel as much and visit the assets, access to capital became limited. Having a local team in the country was a huge advantage and saved us a great deal of trouble. Another plus was that our office assets are of prime quality, fit for the future. They were good before the crisis and will be good after, because they are already able to answer the new standards.

Of course, the experience for shopping centers was very different. They were, in reality, the big victim of the pandemic. In Portugal was made worse by some governmental interventions in the relationship between tenants and landlords. Fortunately, the numbers for October 2021 are looking better, sometimes above the average of 2019.

Having been in Portugal for a few years already, what would you say are the main challenges an investor has to navigate?

I would mention two main challenges: construction costs and long timelines for obtaining building permits - in Lisbon especially. These make it difficult for developers to establish a steady pipeline and for tenants to find suitable office space. Developers are moving forward no doubt, but bureaucracy is real a pain and licensing new projects takes time.

Do you have a final message for the investors that are eyeing the Portuguese market?

The market has great potential and Portugal can turn into the California of Europe giving its appeal for IT. There is a great quality of life here and the real estate market packs in many undiscovered opportunities.

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