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ePaper created 2012-04-20, 15:08:32 | version 1.23.0
52 Management Report – münchener Hypothekenbank eg l annual Report 2011 The situation in the European commercial property markets will not change significantly in comparison to the year under review. Property brokers anticipate that the investment volume in Europe will remain the same or decrease slightly, as a decline is expected in France and the UK, in particular. The security of invested capital will continue to be more important for inves- tors than the return on their invested capital. Commercial prop- erties in the core segment will benefit from this attitude in the area of European-wide commercial property financing, along with commercial housing properties in Germany. Individual pric- ing exaggerations cannot be ruled out in these areas. However, this will lead to a higher level of equity capital participation by investors and not necessarily to a greater willingness on the part of the banks to provide financing. Rents for good-quality office properties will be fundamentally stable in individual countries, depending on their economic development. “The security of invested capital will continue to be more important in the commercial property segment than the return on invested capital.” In the commercial property market in the USA, core markets with above-average job growth, such as the technology hub of San Francisco, will continue to stabilise in 2012. At the same time, supply is expected to decline and rental prices to increase. None- theless, these developments can always weaken or reverse, as the overall economic conditions in the USA remain uncertain. Demand is currently expected to remain at a low level in secon- dary markets Development of business at Münchener Hypothekenbank Despite the wide range of burdens posed by the capital markets, MünchenerHyp expects to post organic growth in its core busi- ness areas, while strengthening the Bank’s sustained profitability in the medium to long term. We want to continue our growth course in the coming years with an unchanged high level of risk-awareness. The focal points of our business areas will gradually shift. The main focus will remain on residential property financing. Our goal is to act as a reliable and strong partner, particularly in our Cooperative Financial Network business with the Volks- banken and Raiffeisenbanken. We see great potential in this business to continue expanding our new business in the com- ing years. This is a realistic target due to the strong market share held by the Volksbanken and Raiffeisenbanken in residential property financing and, secondly, because of the quality of our financing solutions, for which we have received many awards. For this reason we are confident that our products will enable us to be well positioned in the market environ- ment foreseen in 2012. This especially applies to our strengths in the areas of long-term financing and forward financing transactions. In addition, we will continue to improve the efficiency of our loan processing system. We also expect to be able to expand the volume of residential property financing sold via the independent financial services providers sales channel in 2012 and 2013. Since the establish- ment of this area of business, we have built up a good reputation here with the providers and financing platforms, which will sup- port our course of growth. Because of the intense competition in this market, however, we expect that the strong growth in new business seen in this segment over the past few years will weaken a bit in the future. We plan to continue our cooperation with PostFinance. Despite the positive forecasts for the Swiss residential property market in 2012, we expect to see a decline in the volume of new busi- ness here, as PostFinance expanded its group of brokerage partners in the area of residential property financing last year due to strategic reasons. “MünchenerHyp want to further grow organically 2012 in order to reinforce its sustainable earnings power over the middle to long term.” In the commercial property financing business, we will again concentrate on top-tier financing for very creditworthy bor- rowers, primarily in the areas of direct and syndicated business with institutional investors and professional private investors.