Schroder Real Estate today announces continued long term outperformance of its £13.2 billion* real estate portfolio over the one, three and five year periods to the year end 2017.
Across Schroders’ entire real estate portfolio, 87% (on an aggregated basis) out-performed in 2017. 86% of assets also outperformed over the three and five years periods to end 2017. These statistics for funds with relative performance targets are based on benchmark data calculated by MSCI/IPD. The returns for funds and joint ventures with absolute target returns are based on actual realisable IRR.
The outperformance is attributable to Schroder Real Estate’s disciplined investment philosophy focusing on sectors and locations benefitting from structural changes or ‘Mega Themes’ which Schroders has identified as rapid urbanisation, changing demographics, technological innovation, improving infrastructure and the shift from the west to eastern economies. The strategy focuses on owning assets with strong fundamentals in ‘winning cities’, which will be the main beneficiaries of these structural changes. Strong performance was also generated by industrial and logistics assets.
In terms of UK active management, 2017 saw Schroders complete high quality and award winning developments at Ruskin Square in Croydon and The Lexicon Shopping Centre in Bracknell. Key value add activity was also progressed through refurbishments and redevelopments in three Central London Offices, Manchester (City Tower), and Leeds (conversion from offices to a hotel at the Arndale Shopping Centre).
In continental Europe, Schroders completed significant refurbishment programmes in Brussels (Bastion Tower), and a Paris office redevelopment in the 13th Arrondissement. This was in addition to significant restructuring of leases for offices in Berlin (AlexanderPlatz) as well as in central Munich, Zurich and Stockholm. Each activity added significant value in light with various core plus and value add strategies.
Duncan Owen, Global Head of Real Estate at Schroders, said:
"2017 represented another successful year for Schroder Real Estate. Our out-performance across the board is due to a proven and disciplined strategy with a strong conviction that acquiring assets in Winning Cities benefiting from long term structural ‘mega trends’ will generate more sustainable long term returns for our investors.”
Schroder Real Estate - AUM outperformance 2017 Q4, %
1 Year | 3 Year | 5 Year | |
All Real Estate (Aggregated) | 87 | 86 | 86 |
The Schroder UK Real Estate Fund (SREF), Schroders’ open-ended real estate fund, recently received MSCI’s 2018 UK Property Investment Award for best performing unlisted pooled balanced funds, with a capital value of greater than £1.5 billion in the UK market. The award was based on SREF achieving the highest 3 year annualised return to December 2017. Performance awards have also been won by the Schroder UK REIT, The Schroder European REIT (for the best IPO in 2015) and twice by the central London office fund (WELPUT) for achieving the highest 3 year annualised return in 2015 and 2016.
For further information, please contact:
Nicole Carey Tel: +44 (0)20 7658 4466/ nicole.carey@schroders.com
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The views and opinions contained herein are those of Schroders’ investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.’s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.