| Reasons to be optimistic
There's a fair bit of optimistic 'outside influence' in this week's newsletter with not one but two guest articles…
The first is from Andrew Parsons, Portfolio Manager of the Nedgroup Investments Global Property Fund, assessing the prospects for five real estate sectors that have a track record of remaining buoyant and financially viable in the face of economic adversity, and which could perhaps provide opportunities for investors seeking to weather the coronavirus storm.
In our second guest feature, Alpa Bhakta, CEO of Butterfield Mortgages Limited, makes the case for the Prime Central London (PCL) residential market and how a new wave of domestic and international buyers into the PCL residential real estate market in H1, could make 2021 a 'bounce back year'.
"We look set for an eventful 2021 as we hopefully overcome the Covid-19 pandemic and fully transition back to relative normality," says Bhakta.
New figures from Dexters, meanwhile, support that positive view, with the London-based Chartered Surveyor and Estate Agent reporting a busy start to the year for the PCL lettings market. Dexters says over 330 deals have been agreed every week so far in January, up 195 per cent on the same period last year. And predictions of a mass, post-Covid exodus to the country are also overblown with Dexters saying that an absence of tourists means that there are rental bargains to be had in prime locations.
"For every tenant leaving Central London for the Shires we are seeing one return and look to be more central in London than they would normally be able to be," says Matt Huybrechts, Dexters Mayfair Lettings Director.
In another show of real estate confidence, Barings is targeting EUR3 billion of investments in debt and equity in the European property market during 2021 eclipsing the EUR2 billion deployed in 2020, with office, logistics properties and industrial assets remaining key conviction calls for the year ahead.
"All our capital sources are looking to deploy fresh capital into real estate markets across Europe across core, value add and opportunistic returns spectrum, as well as into most market sectors but especially industrial and logistics; transitional offices; and residential," says Charles Weeks, Head of Real Estate Equity – Europe and Asia-Pacific at Barings.
Janus Henderson's announcement this week that the current dealing suspension for its UK Property PAIF and associated Feeder Fund due to the Covid-19 pandemic, will end on 24 February, is another sign of some sort of normality returning to the real estate market. And the company is also pressing ahead with plans, announced in January last year, to make the portfolio operationally net zero carbon by 2030.
"The fund has already taken big steps already toward meeting this goal making a demonstrable impact on the environment and in those communities in which we work," says Janus Henderson.
Another company of the road to a greener future is LGIM Real Assets, which this week published its strategy to deliver net zero carbon across its 76 million sq ft UK real estate portfolio by 2050.
"Achieving our net zero goals will not be easy, but I believe that our industry can decarbonise and move to being part of the climate change solution rather than part of the problem," says Shuen Chan, Head of ESG, LGIM Real Assets.
Property Funds World
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