Mipim DISPATCH: GE, Heitman Plan New Euro Growth Initiatives

CANNES-Rainer Thaler has his work cut out for him. He’s been on the job as managing director of GE Real Estate in Frankfurt for not quite two months, and his mission is not only to add value but to maintain a competitive edge with other GE outposts throughout Europe. Gordon C. Black has been on the job a few years more. But the London-based managing director of international private equity for Heitman has got to stay ahead of the pack, he said, with new initiatives for his international investment client base.

Both men took a break from the Mipim show floor yesterday to sit down with GlobeSt.com and outline those growth initiatives. “We’re rolling out a public securities product in the second quarter of ’06,” Black revealed. The global product will target listed vehicles throughout Europe and, via a “small office” in Tokyo, Asian and Australian markets as well.

Black reported that Heitman already manages on the order of $3 billion in US REIT stocks. “We’re confident that the global product can be that size in three to five years,” he stated. Black revealed that he and his team are currently in Cannes to scout out clients.

The MD also reported that he is exploring new opportunities in Western Europe and “farther east, such as Turkey and Russia, farther east than we’ve typically operated.” But the timing of the new initiative has yet to be nailed down, and much depends, he said, “on the identification of local operators who can provide the necessary market familiarity.” Further details of that vehicle, he said, are still off the record.

While Black further solidifies Heitman’s continental presence, GE’s Thaler is looking to “relaunch” the German operation. Focused to date largely on the housing sector, the German branch is now looking to grow within what Thaler calls three buckets, including additional growth in residential. “We believe in quick and silent transactions,” he said.

Also included on the new MD’s plate are a push into sale-leasebacks and niche markets such as parking assets, data centers and healthcare facilities. These initiatives would take place not only in Germany but in new markets as well, specifically Austria and Switzerland.

Currently posting assets valued at $0.3 billion, Thaler acknowledged that he’s focused on catching up to neighboring GE offices, such as France, which boasts $5 billion in assets, or the UK with its $2 billion.