Nine out of 10 Swiss pensions funds are indirectly invested in real estate while the majority also directly invest in the market, according to research from real estate investment specialist Sal Oppenheim. This suggests that investors are still keen on real estate as an asset class though the preferred investment route is still the indirect approach through investment funds the study found.
Nine out of 10 Swiss pensions funds are indirectly invested in real estate while the majority also directly invest in the market, according to research from real estate investment specialist Sal Oppenheim. This suggests that investors are still keen on real estate as an asset class though the preferred investment route is still the indirect approach through investment funds the study found.
The study conducted by Sal Oppenheim Real Estate and 4IP Management found 89% of Swiss pension funds hold indirect real estate investments while 72% have direct investments. The survey also found that the average allocation to real estate (either direct or indirect) among investment directors with CHF63bn (€bn) was 18% among pension funds in contrast to insurers who had just 13% allocated to property.
When it comes to holding direct property, Swiss pension funds prefer domestic real estate.Residential is favoured, as 66% of their direct holdings were found to be in the residential market. Offices came second, with a 19% allocation by pension funds and 25% by insurance companies, respectively, but the latter group indicating a desire to increase their exposure to residential properties while reducing their office and industrial property holdings over the next two years, according to the the Sal Oppenheim study.
Pension funds also had a 15% allocation to listed real estate and the majority of participants plan to keep that holding over the next two years, albeit they may turn their attention to Asia.
