COVID-19: Could empty office buildings help solve France’s housing crisis?

COVID-19: Could empty office buildings help solve France’s housing crisis?
Even before the pandemic more than six percent of Paris region office space was vacant. (File/AFP)
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Updated 21 February 2021

COVID-19: Could empty office buildings help solve France’s housing crisis?

COVID-19: Could empty office buildings help solve France’s housing crisis?
  • Action Logement aims to invest 1.5 billion euros ($1.8 billion) over three to four years to acquire office buildings and convert them into 20,000 apartments

PARIS: Covid-19 has emptied office buildings and business districts, and with working from home expected to be the norm after the pandemic, some want to convert them to residential use to help solve inner city housing crises.
France has already begun to experiment with such conversions and “the significant rise in remote working encourages scaling up” such projects, French Housing Minister Emmanuelle Wargon said recently.
She wants to accelerate the transformations to respond to both the need for housing and to fight against urban sprawl.
A recent study concentrating on the Paris region, home to nearly a fifth of France’s population, found that if around 40 percent of firms adopted two days of remote working per week following the pandemic, they could reduce the office space they occupy by almost 30 percent, or 3.3 million square meters, over the coming decade.
Such a scenario is a nightmare for the commercial real estate industry — a favorite of investors as it is easier to manage, with slower turnover of clients and fewer unpaid rent bills.
But even before the pandemic more than six percent of Paris region office space was vacant, according to the study from the IEIF research institute.
“The conversion of offices into housing is a bit of a mythical creature,” said IEIF’s director Christian de Karangal.
Although years of discussion have never amounted to concrete actions this time may be different, said de Karangal — even if the extent of remote working’s impact on office space occupancy is still unclear.
That is because — in addition to public authorities encouraging such conversions — some buildings are becoming obsolete for use as offices, and institutional investors are now interested.
But the changes are not always straightforward.
“Not all buildings can be converted,” said Sebastien Lorrain, a senior director for residential, health care and investment properties at international commercial real estate group CBRE in France.
“Only around 20 percent of assets studied showed a real potential for conversion,” he said.
One of the greatest problems is natural light, said Carlos Alvarez, a project leader at the Moatti-Riviere architectural firm, which co-won an industry prize in 2019 for transforming offices into apartments.
Commercial buildings often have much greater floor space, making it difficult to ensure all rooms have windows to let in natural light.
“Most of the time, this results in demolitions,” said Alvarez.
Another issue is buildings constructed in the 1970s — which account for the majority for sale — often contain asbestos, resulting in millions in additional costs to remove hazardous material.
For Norbert Fanchon, director of the public housing group Gambetta, the idea of conversions is “a fantasy as old as property developers.”
He believes to jump-start such projects, the ball is in the court of local authorities, who need to deliver building permits, as well as the French state which needs to “reduce the technical and administrative constraints” that make such redevelopments particularly expensive.
There is some time to resolve the issues holding back the transformations.
“The deflationary impact on the Paris region’s office park will take time” to be felt, said the IEIF.
Employers will first need to define their post-pandemic remote working policies and see how much they can reduce office space. With some commercial rental agreements lasting nine years, the effect on the market will be gradual.
“There is inertia on the markets... (but) the volumes will accelerate,” said Alexandre Chirier, who heads up a conversion division at Action Logement, a public-private group that builds and operates public housing.
Created last year, it aims to invest 1.5 billion euros ($1.8 billion) over three to four years to acquire office buildings and convert them into 20,000 apartments.
Chirier said care must be taken to “build a balance where accessibility, green spaces, open spaces and the quality of accommodation make people feel good.”


Will TASI reignite after its slight fall in November? Here are key takeaways: Premarket

Will TASI reignite after its slight fall in November? Here are key takeaways: Premarket
Updated 33 sec ago

Will TASI reignite after its slight fall in November? Here are key takeaways: Premarket

Will TASI reignite after its slight fall in November? Here are key takeaways: Premarket

RIYADH: Saudi Arabia’s main benchmark index TASI started the week in the green zone with stocks recouping omicron-related declines, up around 350 points from last week.

Al Rajhi Bank traded at 4.8 percent higher this week with around 4 million traded shares.

Sahara International Petrochemical Company saw a recovery of 7.44 percent.

The Kingdom’s oil giant Aramco saw gains of 0.72 percent.

This came as the group announced its entry into the Kingdom’s domestic lubricants as well as its collaboration agreement with French companies including hydrogen car deals with Gaussin.

The International Company for Water & Power Projects, or ACWA Power, and Natixis CIB signed a memorandum of understanding aiming to collaborate on the development of ACWA power in the GCC region.

Natixis CIB will finance up to almost SR7.5 billion ($2 billion) over two years to finance ACWA Power’s projects.

Sadr Logistics’ shareholders approved the board of directors’ recommendation to raise SR175 million through a rights issue worth SR150 million to expand its logistics services. The rights issue trading and new share subscription period will start today Dec.6.

Apart from its rights issue, Sadr Logistics has been on the rise since last week jumping to an all-time high of SR86.2.

With reference to the Public Investment Fund and stc’s earlier announcement, the subscription period for stc’s secondary offering will start on Dec.7 and end on Dec. 8 for retail tranche whereas, for participating parties, it started yesterday and will end on Dec.9.

Saudi Exchange announced the initial public offering of Saudi Tadawul Group Holding Company to be 442.53 percent oversubscribed.

Subscriptions exceeding individual subscribers will be refunded no later than Dec.8, when the listing and trading of the company’s shares on the main market will begin.

Jahez International Company for Information Systems Technology issued the prospectus for its initial public offering at 13 percent of its capital on Nomu, Tadawul’s parallel market.

The offering period will commence on Dec. 23 and end on Dec. 26.


France’s Natixis to finance $2bn ACWA Power projects in 2 years

France’s Natixis to finance $2bn ACWA Power projects in 2 years
Updated 58 min 8 sec ago

France’s Natixis to finance $2bn ACWA Power projects in 2 years

France’s Natixis to finance $2bn ACWA Power projects in 2 years
  • The MoU will allow both parties to “explore opportunities to develop new projects in the region”

RIYADH: France-based Natixis Corporate and Investment Banking has signed an agreement to finance ACWA Power projects over the next two years - with funding of up to $2 billion. 

The MoU will allow both parties to “explore opportunities to develop new projects in the region,” the Saudi clean energy provider said in a bourse filing. 

Natixis has previously underwritten some of ACWA Power’s high-profile projects, including the Sakaka solar project. 


Tadawul IPO 442.53% oversubscribed to reach $1.3bn

Tadawul IPO 442.53% oversubscribed to reach $1.3bn
Updated 06 December 2021

Tadawul IPO 442.53% oversubscribed to reach $1.3bn

Tadawul IPO 442.53% oversubscribed to reach $1.3bn
  • The stock exchange group was offering 10.8 million shares to individual investors

RIYADH: The individual subscribers tranche of Tadawul’s initial public offering was 442.53 percent oversubscribed with a total demand of SR5.02 billion ($1.3 billion). 

The stock exchange group was offering 10.8 million shares to individual investors, or 30 percent of the total offer shares at a final price of SR105. 

Around 598,327 subscribers participated in the period, which started on Nov. 30.


Egypt to launch natural gas-powered bus fleet in 2022

Egypt to launch natural gas-powered bus fleet in 2022
Updated 05 December 2021

Egypt to launch natural gas-powered bus fleet in 2022

Egypt to launch natural gas-powered bus fleet in 2022

CAIRO: Egypt will launch its first fleet of buses powered by natural gas next year, Minister of Public Enterprise Hisham Tawfik has said.

About 70 percent of the components used in the manufacturing of the buses will be sourced locally, in cooperation with several Egyptian companies, he said.

Tawfiq said that the fleet will include buses that can accommodate 14 to 50 passengers, and that the goal of the project is to localize technology and transport production.

“Our strategy is to work in the production of environmentally friendly vehicles, whether they run on natural gas or electricity,” he added.

A delegation from the Belarusian Minsk Automobile Plant signed a contract to supply production materials for the project.

Production is expected to begin in mid-2022, with a target of 250 buses completed per year.

Tawfiq welcomed cooperation with the Belarusian side, especially in light of the distinguished relations between the two countries, which have developed significantly in recent years.


PIF offers 100m shares in stc in secondary public offering

PIF offers 100m shares in stc in secondary public offering
Updated 05 December 2021

PIF offers 100m shares in stc in secondary public offering

PIF offers 100m shares in stc in secondary public offering

RIYADH: Saudi Arabia’s Public Investment Fund (selling shareholder) and stc on Sunday announced the launch of a secondary public offering of stc’s ordinary shares, Argaam reported.

“The potential transaction is in line with the PIF’s strategy to recycle its capital to new investments,” the fund said in an earlier statement. 

A total of 10.02 million shares will be allocated to retail subscribers.

The offering comprises a fully marketed secondary public offering of 100.2 million stc shares, representing 5.01 percent of its share capital

The price range has been set between SR100 and SR116 per share. The final offer price will announced on Dec. 10.

Goldman Sachs Saudi Arabia, HSBC Saudi Arabia, Morgan Stanley Saudi Arabia and SNB Capital are acting as joint financial advisers for STC and joint global coordinators for STC and PIF. The Citigroup Saudi Arabia and Credit Suisse Saudi Arabia are acting as joint bookrunners, according to a bourse filing.