Swiss Life Asset Managers has more than 160 years of experience in managing the assets of the Swiss Life Group. This insurance background has exerted a key influence on the investment philosophy of Swiss Life Asset Managers, which is governed by such principles as value preservation, the generation of consistent and sustainable performance and a responsible approach to risks.
Our objective is to achieve stable, long-term investment returns, creating the basis for our clients to make solid, long-term plans with self-determination and financial confidence. Due to its comparatively attractive risk-return profile of the asset class, Swiss Life has committed its balance sheet capital to Real Estate for over 120 years. Swiss Life Asset Managers co-invests with many of its clients providing strong alignment of interest.
Swiss Life Asset Managers offers this proven approach to third-party clients in Switzerland, France, Germany and the UK with over 1900 real estate professionals in 22 offices around these five countries.
As at 30 June 2019 assets under management for third-party clients amount to EUR 71.6 billion. Together with insurance assets for the Swiss Life Group, total assets under management at Swiss Life Asset Managers stood at EUR 225.0 billion.
Swiss Life Asset Managers is the leading real estate manager in Europe1. Of the assets totaling EUR 225.0 billion, EUR 60.5 billion is invested in real estate. In addition, Swiss Life Asset Managers has real estate under administration of EUR 26.0 billion through its subsidiaries Livit and Corpus Sireo. Total real estate under management and administration at the end of June 2019 thus came to EUR 86.5 billion. Swiss Life Asset Managers employs over 2,300 people in Europe.
1 Property EU, Top 100 Investors, December 2018
INDUSTRIAL: Ongoing strong interest in industrial investment with sins of insufficient supply to feed demand. With global economy slowing, industrial is a sector that is affected markedly. Due to demand/growth, yields compressed quite strongly during the past three to four years. We expect a more sideways movement in the future. Main sector activity stems from ‘traditional’ companies but trends in logistics, ie, in ecommerce and also stable consumer spending offer a good base for growth of the sector.
OFFICE: While demand for good office assets is still high given the relative attractiveness of real estate investments, investors are faced with a lack of good quality supply. While take-up of space has been relatively good due to good employment growth, further developments are to be watched in light of the slowing economic dynamics. At the same time space supply is scarce as well, upholding rental growth in good locations. Also the office markets undergo some structural changes, as space for companies is not just a cost anymore, but an asset to attract and motivate good employees. We expect strongest growths in cities that exhibit a strong base in technology and creative sector along with a good quality of life.
RESIDENTIAL: Due to ongoing urbanisation, the desire of flexibility and most of all the affordability issue, the demand for rental apartments is increasing all over Europe. Markets that are less known for residential investment are attracting attention (ie, Dublin, France and Spain). In this early stage, the residential market may qualify as an alternative sector, so investors are advised to be cautious.
RETAIL: Retailers are still optimising for the perfect balance between offand online offerings of their products. While traditional retail along with the middle value shops (especially fashion) sees the strongest obstacles, value as well as luxury shops are keeping up relatively well. Also shops that are convenient (eg, on the way home) resist the overall trend. Overall, we believe in the adaptability of store-based formats to compete with e -commerce in the long run, but we remain cautious for the medium term given the challenging situation.
OTHERS: Growing importance of the residential sector underlines the shift to alternative segments such as hotels and health care. The mature phase of the cycle has prompted some investors to focus on the higher-yielding alternative sector. Hunt for yield is only one part of these sectors’ growth, given that they also benefit from Europe’s ageing population (senior housing) and increasing travel activity (hotel). The hospitality like concept of, eg, coworking spaces (ie, let the space to an operator and not directly to the tenant) is a trend that is growing in all sectors.
Investment principles & strategy
The world and the economy are changing and demanding more from real estate. This has manifested as a shift in the way that occupiers use property and the lease terms they are seeking. Against this backdrop, we are focused on ensuring our clients’ portfolios reflect this ‘new world’ that is being shaped by globalisation, digitalisation and changes within our society. For us, managing assets and risks means protecting wealth and increasing earnings potentials over the long term. Our asset management is based on understanding our clients’ risk and return expectations and accurately reflecting them in the market. Our top priority is to invest responsibly and act prudently with the assets entrusted to us.
Investment decisions are based on in-house research expertise, strict analysis and approval procedures. Given this our rigorous real estate investment process consists of four main steps:
- Market analysis and definition of property criteria
- Property analysis resulting in non-binding offers
- Detailed due diligence
We manage risk actively and perform risk controls systematically on an ongoing basis to monitor the individual portfolios. These controls enable our clients to review at any time whether the risks incurred are within the set limits and whether the predefined investment process is being observed. The aim is to identify risks early, to avoid them, and to exploit opportunities for the benefit of our clients.
Strategic corporate development
Over the past years, Swiss Life Asset Managers has constantly grown its business activities organically and inorganically. We offer comprehensive services across the full real estate value chain with strong European routes and 22 offices in Europe with over 1,900 real estate professionals.
- Capabilities: closed & open ended real estate funds (listed and non-listed), investment foundations, fund of funds, JVs, club deals.
- Sectors: office, retail, residential, healthcare, hotel, logistics, student housing.
- Broad range of investment strategies across the risk return spectrum with specific focus on well diversified Pan-European core/core capabilities.
- Thematic investment strategies such as European retail, healthcare, hotel and leisure.
- Swiss Life Asset Managers also acts as a partner for co-investments in Europe.
This publication does not constitute an offer or a recommendation to buy or sell financial instruments, but is provided for information purposes only.
News from Swiss Life Asset Managers (Real Estate)
Swiss Life Asset Managers announces completion of its acquisition of a portfolio of core office assets in Paris CBD download
On Tuesday 28 May, Swiss Life Asset Managers completed its acquisition of a portfolio of core office buildings in Paris Central Business District (CBD) from property company Terreïs. The deal includes a total of 28 buildings valued at EUR 1.7 billion. The assets have been acquired by real estate funds managed by Swiss Life Asset Managers’ entities in Switzerland, France, Germany and Luxembourg. A fund with 4 European investors alongside Swiss Life has ...
Swiss Life Asset Managers won the IAZI Real Estate Investment Award for the fourth consecutive year. The asset manager was distinguished this year as the best real estate portfolio manager for third-party clients in the “Best Swiss German Properties” category.
Insights - Real Estate March 2019 download
As we move further into spring, thoughts turn to the direction markets and trends will take. Despite the initial uncertainties, there are many positive avenues to explore both for active asset management and investment opportunities, all of which raise value and generate attractive returns in the long run.
UK real estate returned 2.2% in the second half of 2018 and 6.0% on an annual basis, according to the MSCI All Property quarterly index. Capital growth of 1.4% was achieved over the year, largely due to the yield compression, although this was supported by 0.5% rental value growth.
Real Estate House View - Europe download
Investors are relatively unimpressed by the slowing in economic dynamics. Attractive risks spreads compared to other asset classes are keeping up the interest in European real estate and hence also the volume of transactions.
News from IPE Real Assets
European Thematic Income & Growth Fund includes €150m of co-investment
Analysis from IPE Real Assets
Investors’ drive to do more with fewer managers is accelerating consolidation as firms scramble to provide everything