Nuveen Real Estate is one of the largest investment managers in the world with $152bn of assets under management.
Managing a suite of funds and mandates, across both public and private investments, and spanning both debt and equity across diverse geographies and investment styles, we provide access to every aspect of real estate investing.
With over 85 years of real estate investing experience and more than 820 employees* located across 30+ cities throughout the United States, Europe and Asia Pacific, the platform offers geographic reach, which is married with sector expertise.
For further information, please visit us at nuveen.com/realestate
* Includes 385+ real estate investment professionals, supported by a further 430+ Nuveen employees.
Source: Nuveen, 30 June 2023.
Sector forecasts
INDUSTRIAL:
Industrial has struggled since early 2023. Vacancy rates have surged in Greater China, Seoul and Tokyo, led by new supply and production shortfalls due to weaker global trade. In Seoul, this weaker backdrop has also caused softer valuations although less so for modern facilities in prime locations. The east coast of Australia and Singapore continue to stand out, with many sub-markets seeing low vacancies. However, rental growth has slowed from 2022. Pricing has stayed tight despite higher borrowing costs, which makes acquisition challenging especially given the uncertain macro backdrop and higher rates.
OFFICE:
Weaker office fundamentals are in line with the poor economic outlook across many regional markets. Slow rental performance reflects the uncertain occupier market, as shown in the increase in sub-lease spaces. There is also caution among investors given price movements in the US and Europe and uncertainty over flexi-work. There is also an oversupply risk especially in Hong Kong, Tokyo and selective Chinese cities. Cap rates have shifted out across many APAC markets although less compared to other global markets. Seoul and Singapore offices are most attractive over the medium term, thanks to limited future supplies.
RESIDENTIAL:
In Australia, student inflows have improved. While Chinese students have not fully returned, Indian students have now replaced them as the biggest cohort, illustrating greater demand and resilience for student housing. In the multi-family sector in Japan, there is now a net population movement into city centres from the suburbs across major cities, a reversal of the pandemic trend. This is underpinning income performance and occupancy in the mass market segment, in turn holding up pricing given the wide yield spread and high foreign investment demand.
RETAIL:
Retail is increasingly attractive, with falling vacancies signalling a bottoming of the rental cycle across many regional markets. The opening of borders has also bolstered consumer spending and sentiment on top of resilient labour market conditions. However, this reinvigorated domestic demand and occupancy has not fed through into improved rents, reflecting both lack of confidence among brands to expand, as well as significant empty retail spaces built up over the pandemic. Vacancy in Hong Kong remains close to 12%. Consequently, valuation continues to stay suppressed, especially given much higher interest costs. Tokyo, Seoul and Singapore are leaders in cyclical recovery.
DEBT:
Heightened uncertainty over macro and real estate market prospects amid rising interest rates has continued to draw investors towards private commercial real estate debt. The steady cashflow, downside risk protection and diversification characteristics of debt will continue to underpin investors’ interests. In this current climate, banks are likely to tighten lending criteria given stricter capital requirements and potential cap rate expansion in valuation. This provides more opportunity for non-bank lenders to provide refinancing in senior loan or mezzanine markets to bridge the funding gap.
Investment principles & strategy
A client-focused culture is at the core of who we are and what we believe our clients expect from us.
We take a stable, risk-aware investment approach to our business, which places our clients and investment teams at the heart of our process. Our fund management teams work closely with our clients to deliver investment performance that meets their objectives. The teams operate within a defined investment process with established risk controls, accompanied by investment committee oversight.
Our tomorrow’s world investment philosophy incorporates strategic insights on megatrends throughout every stage of the investment process, looking beyond market cycles to assess how structural trends can best inform long-term real estate investments. Environmental and social governance is embedded into everything we do for the enduring benefit of clients and society.
Strategic corporate development
We work closely with our clients to develop long-term strategic relationships, to understand their goals and meet their requirements. To ensure we provide each investor with a tailored solution, made up of a range of products and strategies, we have developed our range of solutions to offer the resilient, enhanced, debt and impact series:
- Our resilient series is designed for investors who are focused on diversification, income and long-term capital growth. Our strategies focus on investing in high-quality assets in leading cities that are well positioned in terms of long-term structural trends, including demographic change, urbanisation and technology.
- Our enhanced series applies strategies that work within market cycles, use a more active asset management and repositioning approach, and/or invest in emerging sectors and locations. These strategies are designed for investors that are looking for an enhanced level of capital growth.
- Our debt series is designed to provide investors with access to secure, income-focused returns. Our strategies may suit cautious investors seeking attractive levels of income with a measure of downside risk mitigation against short-term capital cycles.
- Our impact series is the newest addition to the offerings and is designed with the intention to generate positive social and environmental impact alongside a financial return. Our strategies are focused on developing solutions for people and the planet.
Performance verification
Nuveen Real Estate’s Performance Team has over 50 years’ of applied real estate performance and risk management experience. Applying strong auditable control risks, and adopting applicable real estate industry standards, the team operates independently of fund and account teams.
COMPLIANCE STATEMENT
All information is as at 30 June 2023.
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particular any applicable financial promotion rules. The information presented in these materials is believed to be materially correct as at the date hereof, but no representation or warranty (express or implied) is made as to the accuracy or completeness of any of this information. Data was taken from sources deemed reliable, but cannot guarantee its accuracy. The statements contained herein reflect opinions as of the date written and
are subject to change without further notice. Nothing set out in these materials is or shall be relied upon as a promise or representation as to the past or future. This information does not constitute investment research as defined under MiFID. Nuveen, LLC provides investment solutions through its investment specialists.
