Intermediate Housing

Intermediate Housing

SNI Group, global real estate operator serving the public interest A subsidiary of Caisse des Dépôts, SNI Group is France s leading landlord with a portfolio of some 348,000 units of housing spread throughout the country. The Group has a longstanding tradition as landlord to major public institutions such as the French ministries of Defence, the Interior and Justice and it has gradually diversified its customer base. SNI Group currently comprises 21 subsidiaries and entities. As a global real estate operator, SNI Group is active in all housing sectors: first-and second-level social housing, intermediate housing and affordable rented accommodation, social housing developments, sheltered housing and accommodation for students, young professionals and the elderly, affordable homes for low-income first-time buyers, etc. As a key stakeholder in housing policy and urban regeneration strategy, SNI Group is able to leverage its extensive local and regional network close to employment pools and its familiarity with local development challenges to provide tailored solutions to local authorities. Key figures Close on: 348,000 housing units under management, including 86,000 units of intermediate housing 1 million people housed Production figures for 2016: 10,500 units of housing delivered Work began on 13,000 units of housing 7,000 units upgraded e1.44 billion in net profit for 2016 e1.1 billion invested in 2016 Trusted partner, key stakeholder Résidence Villapollonia, beside the rail station, Louvres (department 95) 3

Intermediate housing: a sustainable response to the needs of working people and local authorities Intermediate housing straddles a number of public policy focuses and provides a pragmatic solution to current challenges: boosting available housing for the middle classes, stimulating employment and the building sector, promoting social diversity and building the foundations for a more sustainable type of development. It caters to the specific requirements of households that are not eligible for social housing but cannot afford current prices in areas suffering from a housing shortage where rents have gone up sharply over the last few years. It consists of new housing located in urban areas close to employment pools that complies with the latest environmental standards. Rents are capped at between 10% and 15% below the market rate and in order to be eligible, households are subjected to a means test. Helping to reinvigorate construction in France SNI Group has been mandated by central government to play an active role in the intermediate housebuilding programme. The Group s drive to build affordable rented accommodation coupled with its financial clout, expertise and commitments, make it a logical partner of choice for local authorities and real estate developers. 35,000 units by 2020 Partnering the middle classes Intermediate housing provides middle-income working households with: an opportunity to remain in/move into the area in which they work; extra purchasing power: rents are 10% to 15% less than market rates, representing average monthly savings of 150 euros; speedy access to housing: contrary to social housing, allocation is not decided by an administrative committee; applicants are simply means-tested (ca. 75% of French population eligible); new high-quality, energy-efficient housing with lower charges. The missing link between social and private housing Freeing up social housing Producing more intermediate housing also means offering social housing tenants who are subject to the extra solidarity-based rental payments the possibility of moving into a new type of housing, thus freeing up existing social housing. 4

Encouraging social mix Intermediate housing projects are designed as part of broader housing schemes and each programme includes 25% of social housing and usually a specific number of units set aside for first-time buyers. These programmes therefore satisfy three objectives of local authorities: providing housing solutions for middle-income families; boosting the social housing offering; enabling households who wish to do so to become home-owners. Securing production To meet the goal of delivering 35,000 units of intermediate housing over the next five years, SNI Group has already committed to pre-booking building programmes with the 15 largest French property developers, thus securing the acquisition of 8,000 units of intermediate housing every year. Developing access to home ownership The lessor may resell their property after a 10-15- year period, thus providing tenants with deferred, secure access to affordable housing. Demanding excellent performance In choosing SNI Group for the investment, construction, management and upkeep of an intermediate housing portfolio, investors are relying on a trusted partner with renowned expertise. 5

A stimulus plan to build 35,000 units of housing The three components of the intermediate housing stimulus plan A fund involving private investors Fonds de Logement Intermédiaire (FLI) 10,000 units A public fund backed by the French State 13,000 units Investment capacity of e6,3 billion A single investment division that reports to SNI and its subsidiary, AMPERE Gestion Fonds de Logement Intermédiaire In 2014, SNI Group teamed up with insurers and major institutional investors to create Fonds de Logements Intermédiaire (FLI), an entity specifically dedicated to building and managing intermediate housing and France s biggest residential housing fund. In addition to SNI, the fund brings together 17 French investors, including major players from the insurance, life insurance, employee savings and pension funds, personal risk and mutual insurance sectors: ACM (Assurances du Crédit Mutuel), AEW on behalf of the Civil services supplementary pension scheme (ERAFP), AG2R, Allianz, Areva, Aviva France, BNP Paribas Cardif, CNP Assurances, EDF Invest, the French pension reserve fund (Fonds de réserve pour les retraites), Generali, MAIF, Groupe Malakoff Médéric, Natixis Assurances, Neuflize OBC, Predica and the Building and public works mutual insurance society (SMABTP). SNI manages both the funds and the buildings via its subsidiary, AMPERE Gestion, a fund management entity accredited by the French financial markets authority (Autorité des Marchés Financiers). Government-backed fund This billion-euro fund to build 13,000 housing units over five years was set up by the French Ministry for Finance and Public Accounts which put out a call for tenders to select a fund management company. In June 2015, SNI and its subsidiary AMPERE Gestion were selected. The Fund has been vetted by the French financial markets authority and has been created in October 2015 as a French real estate investment fund (OPCI). Investment capacity of e2.3 billion, including leverage Total production of 13,000 housing units Investment capacity of e1.8 billion, including leverage Total production of 10,000 housing units 6

A programme run directly by SNI with the support of Caisse des Dépôts 12,000 units SNI s stimulus programme The third component of the plan consists of an investment programme managed directly by SNI. Beginning in January 2014, the Group put out a call for tenders to real estate developers and local authorities. In order to finance the production of 12,000 units of intermediate housing. The Group s shareholder, Caisse des Dépôts, is commited to increase SNI s share capital by 900 million. Investment capacity of e2.2 billion, including leverage Total production of 12,000 housing units Résidence Les Dominos, Saint-Jacques-de-la-Lande (department 35) To produce these 35,000 units of housing, SNI Group is looking at off-plan acquisitions from developers or the acquisition of undeveloped or developed sites. 7

Focus on regulation The 2014 Finance Act defines intermediate housing as new housing built after 1 st January 2014 that complies with the latest environmental regulations, particularly energy saving standards. It is incorporated into programmes that feature specific standards of architectural quality, infrastructure, high-end amenities and social mix. Income eligibility criteria are higher than for social housing Income eligibility ceiling applicable to tenants for leases signed in 2017 Composition of lessee household Zone A Bis Zone A Zone B1 Zone B2 Single person 37,126 37,126 30,260 27,234 Couple 55,486 55,486 40,410 36,368 Single person or couple with one dependant person Single person or couple with two dependant persons Single person or couple with three dependant persons Single person or couple with four dependant persons 72,737 66,699 48,596 43,737 86,843 79,893 58,666 52,800 103,326 94,579 69,014 62,113 116,268 106,431 77,778 70,000 Additional amount per extra dependent person over five dependants Income eligibility criteria are assessed as of the date on which the lease is signed. + 12,954 + 11,859 + 8,677 + 7,808 Below-market rents Rents are capped by regulations based on location*. They are 10% to 15% less than market rates on average. (NB: the amounts set out in the table below are capped amounts. Rents may be set at a lower level in accordance with the local market). Rent caps in sq.m. /zone under the Duflot-Pinel law Zone A Bis Zone A Zone B1 Zone B2 (subject to accreditation) Gross rent 16.83 12.50 10.07 8.75 Example: a couple with one child renting a three-roomed 65 sq.m. dwelling in zone A bis would save between 150 and 200 a month, representing between 1,800 and 2,400 in extra purchasing power every year. 8 * Article 199 novovicies of the French tax code

Résidence Quartz noir, Carrières-sous-Poissy (department 78) Résidence Nativ, Bordeaux (department 33) Housing close to employment pools In practice, the areas actually concerned are Zone A bis (Paris and outskirts), Zone A (inner Paris suburbs, Côte d Azur and areas along the Swiss border, Lyon, Marseille, Lille and Montpellier) and Zone B1 (other large regional cities). Highly demanding architectural, technical and environmental standards New buildings with energy performance equal to or ahead of the European Directive 2010/31/UE requirements (<50 Kwh/sq.m.PE) and the future HPE (high energy performance) label. Qualityl/Habitat & Environment certification, NF Logement label, providing guarantees of comfort in terms of acoustics, energy performance and accessibility. Parquet, tiling, electric shutters, individualised metering, etc.: the new housing will have amenities comparable to those available in the best first-time buyer programmes. They must also satisfy all the requirements of landlords interested in acquiring sustainable buildings. Professionalised property management Property-owners cooperatives will be owned by institutional investors and managed in accordance with the highest standards and SNIs. Strong local roots Tailored support 9

SNI Group Your contacts SNI Île-de-France (Greater Paris region) Director: Zahir Arroudj 20 place des Vins de France 75012 Paris France Tel.: +33 1 75 77 03 01 Nord-Est Regional Director: Philippe Blech 4 rue Saint-Charles BP 90046 57014 Metz cedex 1 France Tel.: +33 3 87 39 30 01 Bourgogne and Franche-Comté Regional Director: Dominique Chauvet Le Katamaran Parc Valmy 41 avenue Françoise Giroud BP 30428 21004 Dijon France Tel.: +33 3 80 50 56 03 Rhône-Alpes and Auvergne Regional Director: Romain Royet 5 place Camille Georges CS70193 69285 Lyon cedex 02 France Tel.: +33 4 78 95 99 29 Development teams to partner your projects Provence-Alpes-Côte d Azur (PACA) and Corsica Regional Director: Pierre Fournon 22 allée Ray Grassi CS 20023 13272 Marseille cedex 08 France Tel.: +33 4 91 23 69 01 Midi-Pyrénées and Languedoc-Roussillon Regional Director: Jacques Durand 2 place de la Légion d Honneur BP 35865 31506 Toulouse cedex 05 France Tel.: +33 5 34 25 20 03 Aquitaine and Charente Regional Director: Jean-Baptiste Desanlis 3 rue Claudeville CS 90243 33525 Bruges cedex France Tel.: +33 5 56 99 91 73 Pays de Loire, Centre, Poitou and Limousin Regional Director: Bruno Bataille 1 rue des Sassafras BP 90105 44301 Nantes cedex 03 France Tel.: +33 2 51 89 86 73 SNI Grand-Ouest Director: Frédéric Prévôt 1 place du Maréchal Juin CS 24004 35040 Rennes cedex France Tel.: +33 2 99 67 44 40 Résidence Aruba, Pessac (department 33) 11

Cover (from top to bottom): résidence Bell Vue, La Valette-du-Var (department 83), résidence High Park 2, Asnières (department 92), résidence Les jardins d Aurélien, Fréjus (department 83). April 2017 - Design and production: SNI Group Corporate Communication Department - Creation: Agence SAMOA. Photo credits: Architecte Carta Associés, Cabinet d architectes Leibar et Seigneurin, Christophe Caudroy, Lionel Fourneaux, istockphoto/pixdeluxe, Nexity, SNI, Julien Thomazo. Head Office 100-104 avenue de France - 75013 PARIS - France Tel: +33 1 55 03 30 00 www.groupesni.fr