Intermediate housing fund

Plaquette : funds managed


AMPERE Gestion has grown rapidly since it was created in April 2014 by launching France’s first two residential property investment funds. Both funds focus exclusively on a new offering – intermediate rented housing – and they provide a solution for institutional investors looking for an effective “housing” investment solution that will give them a more balanced portfolio.


Intermediate housing: a new rental solution in places with a severe housing shortage


Over the coming years, almost half the increase in the number of French households will be concentrated in a mere 1% of the national territory. This means that the property market is especially stretched in France’s major cities, some of which are experiencing among the fastest demographic growth in Europe.


In order to keep pace with this growth, the French government passed new legislation in 2014 designed to boost the production of intermediate housing earmarked for middle-class households.


Intermediate housing is new housing that complies with the latest environmental regulations, located in major cities as near as possible to employment pools. Rents are 10% to 15% less than market rents  and potential occupants are means-tested.


First Intermediate housing fund (FLI)


As a wholly-owned subsidiary of Caisse des dépôts and the country’s biggest landlord with a portfolio of 346,000 units of housing under management, CDC Habitat teamed up with 17 major private institutional investors to create FLI, France’s first intermediate housing investment fund.


FLI (Intermediate housing fund) was launched on 24 July 2014 with total equity of €515 million and total investment capacity of €860 million. A second round of funding was completed on 29 June 2015, taking the fund’s equity to €1.045 billion and its total investment capacity to €1.8 billion. FLI (Intermediate housing fund) is aiming to finance the construction of 10,000 units of intermediate housing.


Key features of FLI’s (Intermediate housing fund) investing strategy


Special tax treatment

  • Reduced rate of VAT: 10%
  • Exemption from French tax on developed property (Taxe foncière sur les propriétés bâties) for a 20-year period.
  • Commitments: 50% of assets must be kept for at least 10 years, and the other 50% for at least 15 years.


Investments are focused on supply-constrained areas

  • Geographical distribution: Paris, Paris suburbs and selected locations in major regional metropolitan areas outside of the capital.
  • Selection of locations based on micro-local, externally-commissioned studies and on CDC Habitat’s experience of managing its own intermediate housing portfolio.
  • Retention by the property developers of a part of the project risk.


Acquisition and rental strategy

  • Targeted average gross rental margin: 4.8%
  • Securing a competitive advantage by setting rents 15% below the market rate.
  • Minimal vacancy risk thanks to selected locations and below-market rents.
  • Secured indexation over the entire business plan period due to the difference between free-market rents and those of the fund.
  • Assets are acquired with a minimum 20% discount on market price.


Energy-efficient housing tailored to demand

  • Investment mostly in 2-3 room housing units, corresponding to the identified long-term needs of the French population.
  • Energy efficiency compliant with European Directive 2010/31/EU (< 50 Kwh PE/m²/year)