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Amundi Real Estate, the property arm of asset management giant Amundi, plans to boost its assets under management by a further €1 to €1.5 bn in 2013.

The Paris-based group, which is 75% owned by Crédit Agricole and 25% by Société Générale, has been growing its asset management base strongly over the past few years.

If the targeted increase is realised, Amundi's AUM would exceed €8 bn by the end of this year.

In 2012, the company added €1.4 bn of assets under management, mainly driven by the €500 mln acquisition of a portfolio of Metro properties in France. The package, consisting of 43 Cash and Carry assets with a 40% loan to value, was bought through a sale-and-leaseback with the German retail giant, which will occupy the properties with 12-year rental contracts.

The assets were placed in an OPCI fund for institutional investors which closed in December 2012. 'This operation represented a way to refinance the Metro portfolio,' Amundi's CEO Nicolas Simon said. The deal will provide a double-digit return and a cash-on-cash return of at least 7% against a low risk.

Simon: 'There is a high demand for real estate among institutions because this asset class has low volatility while offering capital preservation and high yields compared to bonds.'

The company is negotiating the purchase of a portfolio of seven shopping centres in France on behalf of its institutional clients, he added, but declined to provide further details.

Amundi recently also won a discretionary investment mandate covering real estate in France from the French pension fund for public civil servants. 'We were one of three companies selected for the mandate in a highly competitive process,' Simon pointed out.

On the retail side of the business, Amundi will be focusing on the growth of a new open-ended OPCI structure for retail investors introduced in France last year. Amundi's OPCI vehicle was the first of a new series of open-ended funds for retail investors, similar to the German ones, which may reasonably develop into a market of €2-3 bn a year.

'This is a new range of funds, a third generation of OPCIs is open for mass market distribution with a huge market potential for the future,' Simon noted.

Contrary to past OPCIs, these vehicles are open vehicles suitable for life insurance companies and their distribution channels and distributed to the public like the German funds. Amundi raised €140 mln of equity from investors for its first open-ended fund last year. The vehicle currently represents the bulk of the market, which is still in its infancy with total inflow of as little as €180 mln last year.

'Inflows are accelerating, we have about 20 insurance contracts for the product so we expect another €250 mln of inflows for the open ended OPCI this year,' he added.