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Schroders

Segregated Mandate

Executive Summary on German Real Estate Fund (SMA)

Schroders is managing a segregated account on behalf of a large German institutional client. The fund is designed as an open ended fund, regulated under the German Investment Act (GIA), with a strong involvement by the investor. Schroders is (due to AIFMD) the legal owner of the properties and provides transaction, asset management, strategy and reporting services.

The Fund was launched in 2005 in order to fulfil the client’s strategy to move from direct to indirect real estate investment. Through a larger portfolio sale and approx. 20 single transactions in recent years, the portfolio was optimised and found its current shape with 14 assets and a volume of almost € 700 million. The Fund has no leverage and is therefore an equity only mandate.

The objective of the Fund is to invest, divest and manage a well-diversified real estate portfolio of mainly core and core+ assets with the target to provide an attractive level of income return together with the potential for additional income and capital growth. The income target of 4.5-5.0% p.a. has been achieved or outperformed over the last 9 years (as of 31 March 2020).

The investment strategy of the Fund focusses on commercial real estate in the main German cities with the vast majority being invested in the Top 7 cities. The investments are predominately in the office sector with additional allocations to logistics and retail. An active asset management approach is being pursued in optimising the tenant mix, optimising lease terms and/or undertaking refurbishments to improve the value of the assets.

ESG - Environmental / Social / Governance

At Schroders we believe it is our responsibility as real estate investors to identify, understand and manage environmental, social and economic impacts, positive and negative, to deliver resilient investment returns for the long term and manage exposure to impacts of financial and non-financial risks.  

At Schroder Real Estate understanding these issues and their impacts is integral to our investment process and applies to all aspects of real estate investment including acquisition due diligence, asset management, property management provided by third parties, refurbishments and developments. Understanding and improving the impacts of real estate investment to the environment and society sits alongside our priority to maximise returns for our clients in a manner consistent with our funds’ risk profiles.

Our sustainability approach ”Real Estate with Impact”  is founded on four pillars of impact – People, Planet, Place and Prosperity. These pillars are referenced to the UN Sustainable Development Goals: 8 Decent Work and Economic Growth; 11 Sustainable Cities and Communities; 13 Climate Action, recognising the contribution of the built environment and our responsibilities as real estate investors to society, the environment and economies.

We believe an investment programme which is sustainable should deliver enhanced returns to investors, improved business performance to tenants and tangible positive impacts to local communities, the environment and wider society for the long term.

Schroder Real Estate maintains an Environmental Management System certified to ISO 14001 to manage the deliverable actions derived from our Real Estate with Impact approach. The system applies to all aspects of direct real estate investment including acquisition due diligence, asset management, refurbishment and development as well as services provided by third parties. 

Schroders participates in the Global Real Estate Sustainability Benchmark “GRESB” which is the global standard for real estate funds and companies. Schroder Real Estate is also a GRESB Participant Member and a member of the Better Buildings Partnership.

More details on Schroders Real Estate with Impact approach are available on the internet site:

https://www.schroders.com/en/uk/realestate/products--services/sustainability/ 

 

This fund does not have the objective of sustainable investment or binding environmental or social characteristics as defined by the Sustainable Finance Disclosure Regulation (SFDR). Any references to the integration of sustainability considerations are made in relation to the processes of the investment manager or the Schroders group and are not specific to the fund.

Facts and figures

Segregated Account

December 31. 2020

Fund Type  / Fund Manager

Open-Ended special AIF │ Schroder Real Estate KVG

Risk Type

Core / Core+

Net Asset Value (NAV)

€ 708.9 m

Gross Asset Value (GAV)

€ 788.0 m

Number of assets

14

Leverage (Debt/Gross property value)

none

Country Allocation

Sector Allocation

100% Germany

76% office│10% retail│5% logistics│9% other

Currency Hedging 

n.a.

Distribution yield last 5 years

5.6%

Fund IRR last 5 years

10.4%

Your contact to Schroder Real Estate




Schroder Real Estate KVG mbH

Taunustor 1 (TaunusTurm)
60310 Frankfurt am Main
Germany
Telephone +49 (0) 69 975717-700

Schroder Real Estate Asset Management GmbH:

Maximilianstraße 31
80539 Munich
Germany
Telephone +49 (0) 89 242 98-0

Supervisory Authority:

Industrie- und Handelskammer für München und Oberbayern
Max-Joseph-Str. 2, 80333 M
unich

Schroder Real Estate provides its customers with a wide range of pan-European real estate products such as open and closed real estate funds, special funds and fund of funds or listed REITs and real estate equity funds.