Nuveen Real Estate is one of the largest investment managers in the world with $127bn 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 660 employees* located across over 25 cities throughout the United States, Europe and Asia Pacific, the platform offers unparalleled geographic reach, which is married with deep sector expertise.
* Includes 315+ real estate investment professionals, supported by a further 345+ Nuveen employees.
Source: Nuveen, 30 June 2020.
Retail: The retail sector’s head winds have accelerated as a result of COVID- 19. Major retailers that have filed bankruptcy thus far include: Lord & Taylor, Ascena Retail (Lane Bryant, Ann Taylor), Brooks Brothers, JC Penney, J Crew, Neiman Marcus, True Religion, 24 Hour Fitness and Modell’s Sporting Goods. For the year ending 30 June 2020, retail properties held in the NCREIF Property Index saw a –5.6% total return, which was comprised of 4.4% income return and –9.7% appreciation return.
Industrial: Warehouses continue to benefit from the growth in e-commerce,which has acceleratedt hroughout COVID-19. According to the US Census Bureau, e-commerce sales in Q2 2020 accounted for 16.1% of total sales. Industrial continues to be the top-performing property type within the NCREIF Property Index, posting a 10.3% total return for the year ending 30 June 2020. Industrial net operating income grew 5.5% in Q2 2020 on a rolling four quarter basis, the strongest growth of any other sector, according to NCREIF.
Residential: Long-term demand drivers for apartments are unchanged given the necessity-driven nature and demographic tailwinds such as delays in major life events like marriage and lower than average homeownership rates. The National Multifamily Housing Council’s rent tracker reports that 94.5% of households paid their rent for August 2020, compared to 95.8% for August 2019. Migration patterns indicate growing populations across the Sunbelt markets. As a result, Sunbelt apartments have experienced positive rent growth while coastal apartment rents have fallen. Many of the Sunbelt markets are best positioned to weather the economic fallout from COVID -19.
Office: Modern and sustainable office properties with resilient demand drivers in healthcare and technology are best positioned for outperformance in a post-COVID environment. CBRE-EA reports US office vacancy rose to 13% in Q2 2020 from 12.3% in Q1 2020. During Q2 2020 there was 20.7m sq ft of negative net absorption. Office using employment growth, a critical demand driver for the sector, was negatively impacted by mass layoffs and furloughs in the early innings of COVID-19, particularly in coastal markets. While office leasing activity continues to slow, life science and large technology companies have remained active throughout COVID-19.
Alternatives: A continued shift towards renting, a transformation of the US healthcare system, and a rise in the digital economy should drive long-term outperformance in the alternative housing, healthcare, and technology real estate property types. Alternative property types have proven to be more resilient than traditional property types throughout COVID -19 because their fundamental drivers rely less on economic growth and more on demographics, healthcare, and technology.
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 and debt 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, urbanisationandtechnology.
- 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.
Nuveen Real Estate has its own performance analysis team dedicated to measuring and analysing property portfolio and fund performance.
All information is as at 30 June 2020 and sourced to Nuveen Real Estate.
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