Corporate overview
Aviva Investors is a global asset manager who chooses the power of integration.
With £221bn assets under management across fixed income, equites, real assets and multi-assets spanning 12 countries, employing circa 1,000 people*, you can benefit not just from our significant local knowledge and experience, but also from the extensive global investment resources at our disposal. Our parent company is Aviva plc; listed on the London Stock Exchange and a member of the FTSE 100 Index, it is the largest insurance company in the UK.
The future is full of questions. Only by working together can we find the answers. That’s why we integrate our whole business around your needs – your goals, your values, the experience you have when you work with us. That’s why we start by listening closely to you and understanding your investment aspirations and concerns – from low prospective investment returns, to highly correlated asset prices, from the prospect of rising global interest rates to the challenges and opportunities of market volatility.
Through our vast collective industry experience, we’ve been through every market cycle, making us better prepared for the next one. Inspired by our deep client insight, we build solutions that aim to defy uncertainty, answering the questions that keep you awake at night. Whether you’re a large institutional investor or saving for retirement, we work with you to deliver meaningful outcomes, now and over the long run.
We work hard to join the dots across asset classes to find the best investment ideas; why we break down barriers, so our teams can connect seamlessly, and why we manage risk with discipline and rigour. By working in partnership with you, we bring components together in new ways to ensure you get the very best of our collective expertise with every investment.
Bringing it all together for today’s investor.
* As at 30 June 2023.
Sector forecasts
INDUSTRIAL:
The logistics sector has held up exceptionally well from an occupier perspective, supported principally by demand for e-commerce. Supply chain pressures also continue as the impact of inflationary pressures and material shortages, alongside the increasing shortage of labour, have presented difficulties for demand. Yields moved out during Q2 2022 for the first time in almost a decade as government bond yields trended upward. This outward yield movement is stabilising as the industrial market appeared to have finished re-pricing. Conviction in the market fundamentals remains strong, thanks to continue structural tailwinds. We still believe that ‘last mile’ logistics in the most dense urban areas, which have competing land use pressures, will remain one of the most resilient areas across all property sectors.
OFFICE:
The amount of people utilising workspaces has continued to accelerate post-lockdowns. As a result, demand for certain types of office space is improving; particularly the highest quality. Investor appetite remains focused on new and refitted ‘Grade A’ space. Employers are adapting to hybrid working and there is a growing focus on the provision of amenities and creating a productive and collaborative environment for employees. Offices with strong ‘green’ credentials remain increasingly attractive as attempts to both minimise carbon footprints and to positively impact local communities continue. Although hybrid working has been adopted by many companies, businesses will need to be able to manage mid-week peaks before downsizing can be considered and implemented. We therefore continue to believe that high-quality office space in dense urban locations, which accommodates hybrid working, will continue to see strong occupier and investor demand in the future. Workplace values that don’t fit the above criteria are significantly challenged. At present, the most functional offices in weakest locations are undergoing the most significant re-pricing.
RESIDENTIAL:
The UK for-sale housing market has seen strong price growth in recent years. Activity has declined significantly this year and prices are likely to soften significantly as a result of increased mortgage costs. Whilst consumer sentiment has deteriorated, in certain locations, a lack of home supply underpins the property market’s continuing price trajectory, albeit at a decelerating rate. Whilst in the rental market, inflation continues to feed through to rents nationally, which have risen significantly since COVID. Affordability remains a key issue in many locations. A good way to gain exposure to income growth as well as helping increase the UK’s supply of new housing, is investing in the single-family rental sector. The combination of affordability issues in the for-sale market and increased appetite for more suburban and rural housing due to the rise of remote working, makes the sector look attractive.
RETAIL:
Retail has suffered over recent months with rising inflation having a negative impact on retail sales volumes. The impact of supply-chain disruptions, shortages of goods and materials, and further increases in the cost of debt and energy continue to damage customer sentiment and limit the speed with which goods can be procured. Polarisation remains within the sector. Out-of-town retailing, which includes grocery stores and retail warehousing, where occupancy costs are lower, is currently proving more resilient. In-town retail, notably including prime discretionary high-street stores, is generally more challenged given its higher starting values. As retail had already seen a sustained period of re-pricing over the last few years thanks to the structural changes in the market, it actually saw proportionately less outward yield movement compared to other sectors. Given the higher income returns available in the sector, it is possible for opportunities to exist.
Investment principles & strategy
Aviva Investors is a global asset manager with a broad range of expertise across asset classes. We aim to deliver the specific and meaningful outcomes that matter most to today’s investor.
Our investment solutions help investors whether they are looking to match liabilities, receive a steady and predictable income, protect their investment from inflation or achieve capital growth. Our solutions reflect our clients’ risk tolerances, liquidity preferences and return ambitions. Our strategies focus on sustainable long-term returns. The investment processes are employed across borders so our approach is global. Ideas and research are shared, generating returns from a diversified range of sources, ensuring an understanding of local markets as well as the individual investment requirements wherever clients are based.
We focus on what we do best, and on capabilities and propositions that build on our heritage in managing long-term savings. Our investment services include:
- Credit
- Global and UK equity strategies
- Multi-asset and macro
- Real assets.
Strategic corporate development
Aviva Investors is one of Europe’s largest managers of real assets, with 40 years of experience and over €45bn of assets under management, €28bn of which is invested in real estate (as at 30 June 2023). Our integrated real assets business, Aviva Investors Real Assets (AIRA), brings together real estate, infrastructure, and private debt under a single leadership and operating structure. This provides focus, leverages resources, and creates a true value-based platform across all real assets. We believe this makes us more responsive in delivering the multi-asset and single strategy solutions our clients demand in the private assets universe, ranging from absolute return, growth-oriented strategies through to cashflow and liability matching solutions.
Real assets are a core part of Aviva Investors’ strategy and integral to our growth ambition and in positioning us to meet a growing client need for solutions in this area. With over 120 real assets investment professionals across four locations, our platform has the scale to access the full depth and breadth of real asset markets. This enables us to deploy capital in an efficient and disciplined manner. Our diverse capabilities allow us to deliver the best outcomes for our clients.
