Key Takeaways
- • Invesco Real Estate has launched the Invesco Global Direct Property Fund (GDPF), a direct global real estate fund exclusively for UK defined contribution (DC) pension schemes, according to IPE Real Assets.
- • GDPF invests through Invesco Real Estate managed funds focused on direct properties in Europe, the US and Asia-Pacific developed markets, giving investors exposure to a direct real estate portfolio of more than US$30bn.
- • The fund is the first targeting UK DC investors specifically, with liquidity terms designed for DC schemes, platforms and master trusts.
- • Invesco positions the product as a response to DC demand for global direct real estate, which it says has been limited to UK property or listed REITs.
Summary
Invesco Real Estate has launched a direct global real estate fund exclusively for UK defined contribution (DC) pension schemes, according to IPE Real Assets. The Invesco Global Direct Property Fund (GDPF) is the first product to target UK DC investors specifically. Invesco had said more than two years earlier that it would open its Global Real Estate Fund to UK DC schemes, but GDPF carries liquidity terms designed for DC schemes, platforms and master trusts.
At launch, the fund invests globally through Invesco Real Estate managed funds that focus predominantly on direct properties in Europe, the US and Asia-Pacific developed markets. Invesco said investors would therefore gain exposure to a direct real estate portfolio of more than US$30bn, which it describes as one of the largest directly managed portfolios in the market. Examples of underlying holdings include residential in Japan, logistics facilities in South Korea, healthcare in the US and luxury retail in Milan.
Kate Dwyer, head of UK distribution at Invesco, said the firm had seen long-standing demand among DC schemes for global direct real estate but that there had been surprisingly few options. Invesco said UK DC schemes typically invest directly only in domestic property or globally through listed real estate investment trusts, and that global direct real estate can potentially reduce risk and enhance returns.
Simon Redman, managing director and head of DC and wealth at Invesco Real Estate, said real estate is the largest private markets asset class but has not been fully optimised in portfolios, and that it has continued to offer attractive historic performance and low volatility despite recent macroeconomic and market volatility. He noted that over 95% of global real estate markets lie outside the UK, citing opportunities such as Japan cold storage, Australian student housing and US single-family housing.
Sachin Bhatia, head of pensions and EMEA consultant relationships at Invesco, said the fund draws on Invesco's £73.8bn real estate business, which has 40 years of experience, and has an implicit sustainability focus with an explicit business-wide net-zero target. Invesco also linked the launch to the UK government's value for money consultation and the DC industry's push to increase allocations to alternative assets.
At launch, the fund invests globally through Invesco Real Estate managed funds that focus predominantly on direct properties in Europe, the US and Asia-Pacific developed markets. Invesco said investors would therefore gain exposure to a direct real estate portfolio of more than US$30bn, which it describes as one of the largest directly managed portfolios in the market. Examples of underlying holdings include residential in Japan, logistics facilities in South Korea, healthcare in the US and luxury retail in Milan.
Kate Dwyer, head of UK distribution at Invesco, said the firm had seen long-standing demand among DC schemes for global direct real estate but that there had been surprisingly few options. Invesco said UK DC schemes typically invest directly only in domestic property or globally through listed real estate investment trusts, and that global direct real estate can potentially reduce risk and enhance returns.
Simon Redman, managing director and head of DC and wealth at Invesco Real Estate, said real estate is the largest private markets asset class but has not been fully optimised in portfolios, and that it has continued to offer attractive historic performance and low volatility despite recent macroeconomic and market volatility. He noted that over 95% of global real estate markets lie outside the UK, citing opportunities such as Japan cold storage, Australian student housing and US single-family housing.
Sachin Bhatia, head of pensions and EMEA consultant relationships at Invesco, said the fund draws on Invesco's £73.8bn real estate business, which has 40 years of experience, and has an implicit sustainability focus with an explicit business-wide net-zero target. Invesco also linked the launch to the UK government's value for money consultation and the DC industry's push to increase allocations to alternative assets.
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