NETHERLANDS – Stichting Pensioenfonds Medisch Specialisten (SPMS) has allocated a further €200m to real estate and given Aviva Investors the task of blending public and private investments within its global portfolio.
Aviva Investors took over the management of SPMS’s €350m portfolio of non-listed property funds in 2011, and the fund manager has been asked to expand this into a €550m “holistic” strategy.
The mandate will be managed by Aviva Investors’ multi-manager and listed property teams, both of which have been brought under the umbrella of its Real Estate Solutions Group, an entity that oversees strategies that can also include infrastructure, property debt and derivatives.
Jeroen Steenvoorden, director at SPMS, said such a “holistic solution” would “add flexibility in implementing and maintaining our worldwide real estate strategy”.
He also said a blended approach could create arbitrage opportunities to enhance “returns in periods when a specific real estate category is under or overvalued”.
The Netherlands’ largest pension fund managers APG and PGGM already invest in both public and private real estate, and the SPMS mandate follows the decision by Bouwinvest to invest in both forms of property in a “fully integrated way”.
It also comes the same week that the UK’s National Employment Savings Trust (NEST) said it would invest in a hybrid property fund managed by Legal & General Investment Management, which offers a blended exposure to global listed property stocks and direct real estate in the UK.
Ian Womack, chief executive of real estate at Aviva Investors, said it was “clear pension funds are increasingly looking towards innovative real estate approaches within their portfolios”.
When Aviva Investors took over the management of SPMS property portfolio, it comprised 34 non-listed fund investments in Europe, the US and Asia Pacific.
The portfolio will now be overseen by Aviva Investors’ Real Estate Solutions Group, set up to offer real estate investors more holistic investment strategies.
Many real estate fund managers have expertise in both listed and non-listed markets, but there has been little evidence of these disciplines being brought together in a fully integrated way.
A growing number of companies might look to achieve this in the future.
Last year, for example, William Hill, head of property at Schroders, spoke of a “multi-manager 3.0” concept, characterised by a more agnostic approach that would cover non-listed funds, joint ventures and listed investments.