Big institutional investors stepping back into property markets since the financial crisis largely have sought the security of income-generating assets such as shopping centers. Office buildings still account for the largest share of commercial-property investment, but many investors have reduced their exposure to these properties, which have suffered from vacancies during the recession.
Allianz Real Estate, a unit of German insurer Allianz SE, is telling investors in roadshows that it plans to invest about €11 billion ($15 billion) in European property, aiming to take its portfolio to €30 billion. Allianz Real Estate, which is looking for yields of between 5% and 6%, wants to have about 45% of its portfolio in offices, 25% in retail and 15% in residential. Offices account for 63% of Allianz's portfolio, residential is 20%, and retail is about 17%, according to Allianz Real Estate.