Schroders Capital is the private markets investment division of Schroders. Working as a global platform of specialised, entrepreneurial teams, supported by the scale and stability of a 200-year-old financial institution, Schroders Capital manages and advances private assets to deliver long-term investment performance and positive change for society.
The group has extensive experience in developing world-class real estate solutions in growth areas with substantial opportunities as the market landscape changes over time amongst others including strategies investing in living and hospitality, future workplaces, and warehousing and logistics.
Schroders Capital’s real estate experts are locally embedded in the most attractive real estate markets worldwide. This enables them to source and provide access to the best risk-weighted, S&I-integrated investment opportunities that are then matched with client needs via a proprietary risk/return framework and structured to cater to clients’ liquidity and governance requirements.
Our on-the-ground teams are recognised for their operational excellence and unique hospitality mindset applied to active management, managing each asset as a business by itself, deeply engaging with local tenants to optimise long-term sustainable income and value across the lifetime of the investment.
For more information, visit us at www.schroderscapital.com
Our latest country and sector views are published in a monthly newsletter which can be found here – www.schroderscapital.com/insights
Investment principles & strategy
Schroders Capital is a global real estate manager with deep real estate expertise on the ground and across real estate sectors. The business aims to deliver superior risk-adjusted returns, portfolio diversification and positive impact in investors’ portfolios.
- Research-led: Dedicated in-house research team with access to the wider Schroders Group’s equity and fixed income market analysis, focused on identifying investment strategies based on strong fundamentals, benefiting from structural change and/or temporary supply-demand imbalances.
- Local knowledge combined with global reach: Strong real estate expertise on the ground in all major real estate markets, combining global views with local insights to source, underwrite and manage (off-market) investment opportunities. Proprietary framework to review and consistently assess relative risk and return of the investment opportunities presented by the local teams to underwrite best risk-weighted investments in the respective markets.
- Active management: Each asset is actively managed as if it were a stand alone business, with tailored business plans to optimise income and value which are constantly reviewed and fine-tuned throughout the life of the investment to consistently outperform investors’ expectations. The hospi- tality mindset means optimising services and adjusting lease terms to allow occupiers’ businesses to thrive in the assets to create sustainable income and long-term value for the asset. Value is generated through (re)development and lease optimisation combined with rigorous focus on operational excellence, enhancing sustainability and performance.
- Real estate with impact: Sustainability and positive social impact are inte- gral to the investment process, with industry recognition from GRESB, Edie, EPRA BPR, PRI and BBP. Schroders’ real estate investments look to generate a positive impact on local communities, the environment, and the wider society in the best interest of all stakeholders.
There is no guarantee these objectives will be achieved.
Schroders Capital Real Estate House View
The Schroders Capital Real Estate House View seeks to identify key risks for the real estate market, as well as emerging opportunities which investors can capitalise on to deliver outperformance over the medium and long term.
- Ageing populations and other demographic drivers
Population growth dynamics are creating ‘top heavy’ demographic distribu- tion in societies across the developed world. This is driving strong demand and improving operational performance in so-called ‘care and cure’ markets; senior and retirement housing and healthcare. At the same time, the ‘millennial’ generation is providing demographic impetus in single-family and multifamily markets.
- Individualism, consumerism and ‘slowbalisation’
There is a global trend of shrinking household sizes. International trade slowed drastically in the decade following the global financial crisis. However, digital transactions have grown immensely. We have found numerous opportunities to exploit from this theme. For example, urban logistics and logistic infrastructure are essential to further digitalising the consumer.
- Technology and the knowledge economy
The pandemic stress-tested the effectiveness of working from home in pro- ductivity terms, and in doing so meaningfully accelerated the trend of declining office space requirements. At the same time, demand for sustainable/ highly efficient office space is creating opportunities, particularly those with a growth orientation.
Adding to the broader themes of digitised personal information, entertainment, media, automation, and eventually artificial intelligence and block-chain tech means the rapid growth in data creation is set to continue. It is vital that it is done so sustainably; energy-efficient assets should absolutely be the focus.
- People and places
The cost-of-living crisis has highlighted the acute and pressing need to address social inequality. Real estate can play an integral role in redressing the balance. Social and affordable housing can provide new, high-quality, purpose built single-family and multifamily accommodation for families on low incomes. Affordable workspace can generate high employment impact and social mobility. Similarly, the refurbishment of stranded assets is providing numerous opportunities.