| Valuation method | Value, € | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 24.05 | 1 |
| Intrinsic value (DCF) | 8.00 | -67 |
| Graham-Dodd Method | 24.20 | 1 |
| Graham Formula | 59.24 | 148 |
Patrimoine et Commerce SA (PAT.PA) is a French real estate investment trust (REIT) specializing in commercial properties, primarily located in high-traffic suburban and medium-sized city centers across France. The company owns and manages a diversified portfolio of 31 properties totaling 129,280 square meters, including shopping malls, supermarkets, retail shops, and business parks. As a REIT, Patrimoine et Commerce benefits from tax advantages while generating stable rental income from long-term leases with strong tenants. The company focuses on secondary cities with lower competition and higher yield potential compared to prime urban markets. Its strategic asset selection and hands-on property management contribute to consistent occupancy rates and cash flow stability. With a market cap of €377 million, Patrimoine et Commerce offers investors exposure to French retail real estate with a defensive income profile and moderate growth potential.
Patrimoine et Commerce presents a conservative investment opportunity in French retail real estate, offering a dividend yield of approximately 5.1% (based on the €1.35 dividend and current share price). The company's focus on non-premium locations provides insulation from e-commerce pressures affecting high-street retail, while its supermarket-anchored properties demonstrate resilience. Financials show stable revenue (€70.7 million) and healthy net income (€41 million), supported by efficient operations. However, the high debt-to-equity ratio (€426 million total debt) and concentrated French market exposure pose risks. The low beta (0.19) suggests defensive characteristics, making it suitable for income-focused investors seeking French commercial real estate exposure with lower volatility.
Patrimoine et Commerce occupies a niche position in the French REIT market by focusing on secondary cities and suburban commercial properties, differentiating itself from competitors targeting prime urban retail. This strategy reduces direct competition with larger REITs while capturing stable demand from necessity-based retailers. The company's competitive advantage stems from its local market expertise, hands-on asset management approach, and ability to identify undervalued properties in growing secondary markets. Its portfolio composition - heavily weighted toward food-anchored retail and essential services - provides recession-resistant cash flows. However, the company faces challenges in scale compared to larger French retail REITs, limiting its bargaining power with tenants and access to premium assets. The focus on smaller cities may constrain growth opportunities as these markets have lower liquidity and fewer acquisition targets. Patrimoine's conservative leverage (though absolute debt is high) and operational efficiency help maintain profitability, but its smaller size makes it less attractive to institutional investors compared to sector leaders.