UK - The Strathclyde Pension fund has replaced the manager of its £750m (€906m) direct UK property portfolio for the first time in 20 years and made its first strategic allocation to global real estate.

DTZ Holdings has succeeded Aberdeen Property Investors as the local authority's UK property manager, while Partners Group has won the mandate to run a £200m global multi-manager portfolio.

At the end of last year, Strathclyde invited applications from real estate managers to run a direct portfolio worth as much as £1bn, a portfolio of UK funds worth up to £400m and an overseas pooled funds portfolio worth up to £400m.

DTZ was selected ahead of Aviva Investors, CBRE Investors and Aberdeen for the UK portfolio, while Partners Group was chosen ahead of CBRE Investors and The Townsend Group for the global multi-manager portfolio.

Investment consultants Hymans Robertson helped Strathclyde whittle down the more than 50 initial responses, and final interviews were conducted last month.

The pension fund decided to put its UK real estate portfolio out for tender for the first time in 20 years for a number of reasons, including recent market underperformance.

The decision was also taken because Strathclyde's incumbent manager had changed corporate ownership since it was originally appointed (Aberdeen Asset Management acquired Goodman Property Investors in 2008), and the pension fund's portfolio manager at Aberdeen had been replaced.

Jacqueline Gillies, chief pensions manager for investments at Strathclyde, said: "The rationale was threefold really - we had a change of corporate ownership, a change of manager and some concerns over performance.

"Over the past year or so, there has been some deterioration in the portfolio's performance, and it has hit long-term performance as well."

Gillies declined to provide any information as to why DTZ was selected over others, as Hymans Robertson was still undergoing a formal feedback process with all candidates.

The pension fund has been fairly active in the UK real estate market recently, including the £66.5m acquisition of 141 Bothwell Street offices in Glasgow at the beginning of the year.

Gillies said the UK investment strategy was now being discussed with DTZ.

"Aberdeen has made a number of purchases on our behalf this year - the new manager will as well," she said.

"Some of that might be reshaping the portfolio as it stands. We expect the new manager to be active."

Strathclyde is seeking higher returns from its global real estate exposure, which has a target allocation of 2% of total assets under management.

"Partners Group put forward various proposals as to how that could be invested," said Gillies.

"But final allocations were to be decided, so I will be starting discussions with them, and we will be looking to agree an investment programme with them over the summer."