DTZ Investors (Real Estate)

Corporate overview

DTZ Investors is a specialist asset manager with a near 60-year track record of creating value for clients across global real estate markets. DTZ Investors manages €15bn ($16bn) of assets for a range of high-profile institutional investor clients. With a team of over 100 personnel in its main offices in London, Paris and Tokyo, we offer multiple real estate investment solutions for clients including commingled funds, separate accounts, club deals and fund-of-funds.

Investment principles & strategy

DTZ Investors generates long-term superior returns for clients by customising an integrated service that marries their investment objectives with a detailed knowledge of real estate markets, responsible investment and the value-creation process. Our approach relies on five key beliefs:

Act responsibly – We take responsibility for delivering on our clients’ return objectives within their risk parameters through a customised approach that marries global investment know-how with local market execution expertise. Our responsible investment philosophy combines environmental and wider societal benefits with financial returns that are assessed over the long-term.

Take controllable risks – We have strong processes to identify, price and manage risk. We assess returns at an asset level and balance risk at the portfolio level. We avoid location and credit risk and take on leasing and obsolescence risk that can be priced and managed.

Persistence pays – Strong processes and detailed due diligence avoid mistakes, secure value and ensure liquidity in portfolios. We marry strong processes with a two-stage governance process that assesses price and risk on all transactions over the long-term.

Generate value through active management – We operate vertically integrated teams that understand building design, occupier need and asset potential to engineer value. We marry this with a deep knowledge of the capital markets to determine how best to finance value creation.

Sell well – A strong sell-discipline is essential in understanding when an asset’s place is no longer justified in a portfolio. We review our sales process regularly to crystallise returns or mitigate risks through a combination of investment process and governance.

Sector forecasts

INDUSTRIAL:

The sector’s fundamentals should remain resilient despite increased geopolitical and tariff-related uncertainties. E-commerce growth and increased near-shoring activity will support demand, while higher development costs and planning restrictions will slow future development, helping to stabilise availability rates. We expect prime assets will continue to deliver positive rental growth given occupiers’ preference for high quality assets that enhance business operational efficiencies and comply with more stringent ESG targets. We favour modern industrial estates and urban logistics that are supported by increased e-commerce, urbanisation trends and increased defence spending.

OFFICE:

Europe’s office markets are in a state of transition; supply is rising due to flexible work arrangements and tenant consolidation, and demand is being tempered by recent cyclical economic weakness and the rapid integration of AI into business practises. We expect the ongoing polarisation in performance between prime and secondary stock will persist. Prime, ESG-compliant buildings within the major metropolitan European CBDs will continue to be supported by strong tenant demand. While the limited supply of best-in class stock will present ample opportunities to reposition older, well-located buildings into prime space across Europe’s major CBDs.

RESIDENTIAL: 

The residential and multifamily sectors should offer stable income and positive income growth where demographics are compelling. Europe’s ageing population will continue to support occupier demand in the senior living sector, while the shortage of high-quality, convenient and well connected urban accommodation for the young across Europe’s major cities should support the performance of PBSA.

RETAIL:

Several factors will impact the sector’s outlook including subdued consumer sentiment, reduced spending on non-essential retail goods, increasing competition from e-commerce, rising operational costs, and a surplus of non-prime town centre space. But the rebasing of retail rents to more affordable levels should support leasing activity providing scope for a modest recovery in rental values, especially for prime locations. Higher than average income returns will make the sector a standout performer in the near term. We prefer the essential retail segments (retail parks and supermarkets) for their supportive fundamentals, inflation-linked income, and their resilience to the changes in consumer spending habits. Prime assets in attractive retail destinations should deliver positive rental growth given the strong occupier demand for flagship space.

OTHER:

Hotels - The hotel sector will be supported by favourable demand and supply dynamics and the continued rise in international tourist arrivals across key tourist markets in Western Europe. Data centres - The expansion of AI technologies, the increased demand for robust digital infrastructure and record low levels of vacancy, will ensure that demand outstrips supply across Europe’s major markets.

Life sciences - Tariff-related disruptions to the global high-tech industry and pharmaceutical supply chains should bolster demand in Europe’s life sciences sector. Europe’s key innovation hubs are also well positioned to gain from any movements in capital and talent from the US if geopolitical tensions worsen.

Strategic corporate development

We continue to develop our business to meet the needs of our clients. Development comprises geographic platform expansion, service lines, sectors and investment products.

We are committed to reducing our own and our sector’s impact on the environment. We will continue to develop our responsible investment programme, working with agencies such as the PRI, GRESB, IIGCC, TCFD and Better Buildings Partnership to deliver transparent improvements to our managed portfolios. We continue to focus on the 30 principal urban economic centres that dominate the European real estate markets. Our non-domestic clients have a requirement for complex, bundled services on large scale assets in these markets.

We will continue to focus on real estate development, particularly in growth markets where technology is driving demand for a new type of real estate that is more flexible than current stock. This will extend our recent investment programmes in logistics and urban living. We will continue to partner with best-inclass operators in these markets where appropriate. We see asset opportunities at each end of the risk spectrum. We expect the changes in market liquidity and the shifts in how long-term investments in real estate are funded to offer well-funded core buyers to secure top-quality assets at fair prices. We also expect the debt-funding gap to create value-add opportunities for conviction buyers who can act quickly when market activity is quiet.

Performance verification

Our UK track record is benchmarked against the MSCI Index and is compliant with the Global Investment Performance Standards (GIPS). In the UK we have an exceptional performance track record; we have won 19 prestigious MSCI performance awards since 2000 and we also received an award for the top performing fund on a 10 year basis in the UK and we were the winner of the European long-term risk-adjusted relative return award in 2023. Our house performance has beaten the MSCI benchmark by 1.0%p.a. on average over the past 10 years to December 2024. In Continental Europe, we won the ‘Pierre d’Or’ as Best Asset Manager of the year and the European Pensions award for Best Asset Manager reflecting our work for a range of value-add strategies in offices, residential and logistics.

We have also achieved a number of responsible investment successes in 2024. We were awarded a 5* rating by PRI for Policy, Governance and Strategy; Direct Real Estate; and Confidence Building Measures. We were also awarded 21 GRESB Green Stars across our Funds, and we were recognised as a Global Sector Leader by GRESB.