One look at the promotion of Nunzio Laurenziello to CEO of Generali Real Estate SGR, which manages the insurer's real estate stock and bond fund investments, and you'd be forgiven for feeling a sense of déjà vu.
After six years leading Generali's real estate debt platform (read more about him in our companion publication Real Estate Capital Europe ), Laurenziello succeeds long-time executive Alberto Agazzi, who now takes on the newly created Senior Real Estate role at parent company Generali Real Estate SPA.
The decision to promote Laurenziello comes for similar reasons to the promotion of the head of real estate at Ivanhoé Cambridge, the real estate business of another large institutional investor, Caisse de Investissement du Québec. As part of its internalization, the Canadian public pension fund promoted Rana Gorayeb, former head of CDPQ's real estate credit business, Oterra Capital, to head of real estate, where he took up the new role this week.
In a farewell interview with PERE published on Monday, his predecessor Natalie Paradichev described Gorayev as a “natural” successor given that his appointment comes at a time when the real estate credit market is at the forefront for most private real estate entities following a spike in base rates in 2022 and subsequent market turmoil around the world. Paradichev believed Gorayev was not only well-placed to value the liabilities attached to Ivanhoe's roughly C$77 billion (US$56.12 billion, €52.4 billion) of assets under management, but also to identify new investment opportunities on the liability side of the capital stack.
Generali declined to comment beyond its statement on the senior bond changes, but PERE understands from sources familiar with the investor that one aim is to become more active on the credit side of the capital markets. The investor, which manages €37.4 billion in assets, is already involved in value-add and construction lending, according to PERE data, and is also likely to want to become more active in senior debt issuances. In Laurenziello, Generali has an expert who has lived through a lending market that just experienced its biggest shift in costs since the 2008 global financial crisis.
With these promotions, both investors are emulating talent strategies that have already taken off among a variety of managers in recent times. To give just two examples, Starwood Capital Group in February named Jonathan Pollack, who was global head of Blackstone's global real estate credit business, as president. A few months earlier, KKR promoted Chris Lee to co-president. Lee was in charge of the private equity firm's U.S. real estate business as well as its global real estate debt practice.
A widening funding gap is expected to materialize as commercial real estate debt maturities reach $1.5 trillion in the U.S., €650 billion in Europe and $177 billion in Asia by 2025 — the totals in manager PIMCO’s savvy Real Estate Reckoning whitepaper. Against this backdrop, the logic of promoting senior executives from the credit industry is becoming glaringly clear to managers and investors alike.