Alain Taravella (Altarea) : Immobilier, Altarea subit une érosion de ses réservations de logement

We have indeed entered a new economic situation. For 10 years, interest rates were falling and allowed many buyers to purchase housing under extremely attractive conditions, since interest rates were almost zero, the rate for buyer loans was at 1%. So it was quite easy to borrow and many people took advantage of it. At the same time, there were still a number of difficulties in obtaining building permits, as you said, and that reduced supply. So there was a kind of upward speculation: less supply, demand was easy with buyer loans at a fair price, and so prices rose. Today there is a reversal. The reversal is that rates, in the space of less than a year, have taken about 3%. That is, from 1% we are now between 3 and 4% for a... so it removes a certain number of customers who can no longer buy. It does not remove the desire to buy. I think fundamentally the French want to buy apartments, whether to live in or to invest. And supply, on the other hand, is still a little difficult. There is not enough supply to allow people to live. So we still have a certain deficit of supply and demand is a little weaker because people can no longer buy. That said, what we observe is that there is still a willingness of the French to buy an apartment. Who can regret after 10 years having bought their apartment or having invested in real estate, even with the rise in rates? There is still an image... That doesn't make the business. There is another phenomenon: inflation. Today we are in an inflationary period. So when you buy an apartment today at today's price, even with a slightly higher interest rate, you still have the hope that this apartment, the value of this apartment, will increase with inflation and that your capital will be preserved. So there is still an interest for the French to buy either for themselves or to invest. But it's true that there is a layer of clientele that has been excluded. So we must indeed find solutions to bring this layer of clientele back to housing.

I'm not going to tell you this morning that our job is easy. Interest rates are rising. Land prices are stabilizing but not really falling. We have more and more constraints, and it's normal: environmental constraints, decarbonization, having more virtuous housing costs a little more. So indeed, real estate costs a little more, costs more. So that's what we have to manage. We have to rework our projects, have products that are more accessible, sometimes a little smaller than what we sold before. It's better to have an apartment that can be bought of 65 square meters than an apartment that cannot be bought of 70 square meters. So that's all the work we are doing. We are in a phase of turnaround, but today the French have not yet become aware of the protective role of real estate in a period of inflation.

In fact, what happened in 2022: our group is multiple. It does of course housing, its main activity, it does offices and... offices. We had an extremely strong year. We sold part of Orange's headquarters, we built a building in La Défense. 47% on office activity, and notably I would just like to mention a building in La Défense that we built for Cybercampus Défense, that is, the company that brings together large companies and the state that work in the field of combating cyber terrorism. So there we rented an entire building. We sold to people who do that business. And above all, there is one thing: the crisis is coming, but the crisis can stop. We have retail. What happened in the last two years? In 2020, everyone said that retail in shopping malls was dead, shopping malls were closed due to the pandemic. Then we realize in 2022 that customers have returned to shopping malls. So our rents have been paid again, our revenues increased by 20%, which is enormous. Retailers are selling better, selling more than in 2019. So there you go. We are a multiple group with multiple activities. These activities experience slowdowns, crises, but they come back. And that's why it's the mix of all that that makes retail work better, offices work better, housing works a little less well. All together makes a small progression.

I am not worried in the medium term. Today there are issues to be resolved. For retail, retail is adapting. There are streets that are indeed empty, others that are filling up. You have to invest. It's like all businesses, a street is not good or bad in itself. Municipalities sometimes need to invest. We, in shopping malls, we invest constantly. To come back to office buildings, there is indeed a change since the pandemic. There is teleworking. So what do we observe? There is a reduction. I am someone very lucid and I see the issues. So the number of square meters of offices will decrease, but not everywhere. People who want to go to the office want to be more comfortable. They want, when they come, to have more common space. Forgive me, but this discourse was held to us a few months ago: we were told the office will transform, we will not reduce the size of offices, we will just arrange them differently with social space benefits, quote unquote. Today the reality is that we have square meters of offices that are unused, and companies are looking rather closer to the center, smaller, smaller, and therefore more expensive. Today what do we see in Paris? Prices are rising, office prices are rising. We are breaking records. Today in the best-located districts we reach 1000 euros per square meter. That was not the case two years ago. Indeed, all offices will have empty offices. And so the subject for a group like ours is to know these empty offices, what do we do with them? Can we transform them into housing? Under what conditions? At what time? So there is a whole lot of work to be done on that. Our group does a bit of all trades, so we are capable of making products. To take an example, we just delivered this year in Issy-les-Moulineaux, here in the city center, it was 40,000 square meters of empty office and workshop. We demolished, we rebuilt, we made housing, we made modern offices, we installed the headquarters of a large company, we made retail. Yes, real estate, despite its name, is not immobile.

Regulatory constraint. You know, we have our headquarters on Rue de Richelieu. We bought it 8 years ago. It was a rotten building and there was a building permit. It is magnificent now. It is magnificent. We restructured it. I said, what's the point of demolishing? We can restructure it. Demolishing, no one imposed it on me. It was the smartest thing to do. So today, as you say, there is energy renovation. Tenants leave because they want to find fewer square meters. When the building is empty, if the owner wants to re-let it, he must do all the necessary work to restructure it so that it is energy efficient. And there are millions of square meters that in the next 10 years, 20 years, will be transformed. Our job is to transform, to improve.

There are different types of mayors, different municipal policies. First of all, one thing: who can say that we should not build housing in France? Indeed, there is still a lot of space under the bridges of Paris. One could say that's where people should live. That's not the case. So we need to build square meters to restructure square meters. I think we will need, more importantly, in the same way that we restructure office buildings, to restructure residential buildings so that they are energy efficient. We need housing. Families are smaller, single-parent. We need that. But then we have to convince mayors. So indeed, there are mayors who are more easily convinced than others. And others who put forward zero net artificialization, for example, which is normal. But we must succeed in the housing constraint. I tell you one thing: in two years, three years, five years, we will have a housing crisis, and it will become a priority.