Invesco Real Estate, the real estate investment business of Invesco Ltd, has launched a fund exclusively for UK defined contribution (DC) pension schemes.
The Invesco Global Direct Property Fund (GDPF) aims to improve DC investment outcomes by investing in direct global real estate, offering potentially higher returns and a lower risk profile through portfolio diversification and straightforward access to a mainstream global asset class at low cost.
According to the firm, since the UK represents less than 5% of global investible real estate, global investment allows DC investors to enjoy stable income from physical buildings without the constraints of a single country.
At launch, the fund will globally invest its assets through Invesco Real Estate managed funds, primarily targeting direct properties in developed markets of Europe, the US, and Asia Pacific. Investors in GDPF will access a direct real estate portfolio exceeding US$30bn, ranking among the largest directly managed portfolios in the current market.
Kate Dwyer, head of UK distribution at Invesco, said: “GDPF not only supports the DC industry’s focus on increasing allocation to alternative asset classes but also the UK government’s Value for Money consultation.”
Simon Redman, managing director, head of DC and wealth at Invesco Real Estate, commented: “Despite recent macroeconomic news and equity and bond market volatility, real estate as an asset class has continued to offer attractive historic performance and low volatility.”
The firm cited examples of underlying investments include residential in Japan, logistics facilities in South Korea, healthcare in the US and luxury retail in Milan.
Sachin Bhatia, head of pensions and EMEA Consultant Relationships at Invesco, added: “The fund’s core offering, has an implicit sustainability focus with an explicit business-wide net zero target, which we believe enhances potential returns.”
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