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 1450 real estate professionals in 32 offices around these five countries.
As at 30 June 2018 assets under management for third-party clients amount to EUR 55.8 billion. Together with insurance assets for the Swiss Life Group, total assets under management at Swiss Life Asset Managers stood at EUR 194.4 billion.
Swiss Life Asset Managers is the leading real estate manager in Europe1. Of the assets totaling EUR 194.4 billion, EUR 47 billion is invested in real estate. In addition, Swiss Life Asset Managers has real estate under administration of EUR 25.2 billion through its subsidiaries Livit and Corpus Sireo. Total real estate under management and administration at the end of June 2018 thus came to EUR 72.2 billion. Swiss Life Asset Managers employs over 1750 people in Europe.
1 Property EU, Top 100 Investors, October 2015, 2016 and 2017
INDUSTRIAL: Ongoing strong demand for logistics is visible in increasing transaction volumes. Demand is driven by good fundamental such as the economy and growth in e-commerce. Due to demand/growth, yield compressed quiet strongly during the past three to four years. We expect the same movement in 2018, after that more sideways movements. At the moment it is probably the one sector with the strongest pressure on yields. Main sector activity stems from ‘traditional’ companies but trends in logistics, ie, in e-commerce and also increases in consumer spending offer a good basis for growth of the sector.
OFFICE: Office markets still see highest demand and appetite keeps up, for one given by overall attractiveness of the real estate markets, for the other as good economic fundamentals keep demand for office space up. The lack of new supply and of existing good quality has somewhat aggravated in the course of 2017, pushing rental growth in most markets. Overall, there we also expect rents to grow in 2018. We expect momentum to uphold until 2019, before slightly changing direction or only being stable. Also the office markets undergo some structural changes, as space for companies isn’t 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 demographics, housing remains a major trend in Europe. New forms of housing with high flexibility for younger people are being developed as well as senior-friendly facilities for older people. 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 need to be cautious.
RETAIL: Remains challenging, as structural change ongoing and retailers need to adapt. Continuing low inflation should buoy up retail sales. Only exception is the UK, where e-commerce, an economic slowdown and low wage growth are strongly impacting the sector. Overall, we believe in the adaptability of store-based formats to compete with e-commerce in the long run, but we remain sceptical for the medium term given the challenging situation.
OTHERS: Growing importance of the residential sector underlines the shift to other alternative segments such as hotels and healthcare. 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).
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 26 offices in Europe with over 1,300 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, Real Estate France acquires two commercial properties in Milan, Italy download
Following the acquisition in May 2018 of two hotel properties in Milan, Swiss Life Asset Managers, Real Estate France has acquired two commercial properties in October in Milan, Italy.
Swiss Life Asset Managers purchases "Laetitia" portfolio for the new BEOS Corporate Real Estate Fund Germany IV (CREFG IV) download
Swiss Life Kapitalverwaltungsgesellschaft mbH (Swiss Life KVG), in cooperation with BEOS AG, has purchased the “Laetitia” portfolio consisting of 32 commercial properties at locations throughout Germany.