He told the CIMMIT conference in Frankfurt in late January thatthe group has been net sellers for the last five years and soldaround €3.5 billion in assets, much of it in the boom years 2006/7.It only began to focus comprehensively on real estate as an assetclass in an August 2008 reorganisation that set up Allianz RE.

Unlike open-end funds, he told PIE on the sidelines, Allianz REdoes not have to concern itself with liquidity considerations. Fundmanagers on the panel had illustrated that excessive demand fromretail investors for real estate mutual funds had made managementof liquidity difficult. Sudden liquidity loss has also sparked thehighly controversial re-closure of open-end funds in the last fewmonths.

"Allianz comes from a position of 4% allocation to real estate,this means practically from nowhere, and we want to go up to 6% oreven 7%," Brendgen told the conference. "This creates our famous€10 billion to €13 billion in intended investment that we want toexecute in the next three years."