Alternatives to civil property investment companies (SCPI), civil companies (SC) or civil property companies (SCI) are developing rapidly in life insurance. By 2021, they captured 29% of consumer real estate collection, according to the French Association of Real Estate Investment Companies (Aspim), a professional association in the sector.
And the craze continues as these media recorded 2.5 billion euros in net subscriptions in the first half of 2022, a volume up 37% compared to the same period the previous year.
Designed specifically for life insurance, these products are a type of fund of funds. SCs can invest in multiple products: SCPIs, physical assets, listed real estate companies, etc. They can also hold cash, making it easier to manage customer inflows and outflows.
This approach has several advantages: diversification and flexibility. In fact, civil societies can more easily develop their heritage to adapt to a change of context. Finally, the collected dividends are kept in civil society to be reinvested, making life easier for the saver.
Good performance in lifelong housing
The other side of the coin is that they accumulate management fees: their own commissions and those of the underlying companies in which they invest. By subscription, on the other hand, the access fees are reasonable: 2% most of the time. A reassuring element, because these will quickly be amortized, and it will be possible to quickly get out of the unit of account if the results are not up to par.
Another negative point is that the liquid funds reduce the potential return compared to SCPI’s purer investment strategies. Last year, non-trading companies available in unit-linked [des supports pour lesquels le capital n’est pas garanti] thus generating a performance of +3.8% on average, while the average distribution rate for SCPIs was 4.45% (excluding stock appreciation).
However, inflows were largely captured by residential thematic SCIs, which offer above-average performance. Thus, SCI Viagénérations (Turgot AM) achieved a performance of 5.79% and Silver Age (Federal Finance Gestion), 8.80%. Several media have recently been launched on the theme of health and they should be very successful (Trajectoire Santé by Euryale AM or Cap Santé by Primonial REIM).