REAL ESTATE - UK insurer Clerical Medical has hired fund manager Invista to spearhead its entry into continental European real estate.
The pan-European portfolio will invest in sectors, such as commercial, with a core income profile.
A spokeswoman for Invista said the fund, which has a target size of £300m (€443m) over three—five years, would invest exclusively in mature European markets, notably France and Germany. Invista already has investments across seven European markets.
Accelerating rental growth from a relatively low base and diversification benefits make "the most transparent, the most liquid and the most established property investment markets" in Europe an attractive option for UK investors deterred from the domestic market by yield compression.
The fact that European leasing markets move in different cycles means investors can stock-pick within regions, cities and sectors, Invista said.
However, the spokeswoman denied that the investor exit from UK real estate had become a trend. Invista CEO Duncan Owen said in November he saw "a couple of good years" in the central London office market, and that the UK residential market remained "solid".
Clerical Medical last month put up for sale its 50% share in Glaswegian specialist shopping centre Princes Square.
Head of funds Alan Tripp told IPE Real Estate said the move was designed to balance its portfolio away from an overweight position in retail, rather than away from UK property.