UK - Separating pension funds from their residential property holdings would renew UK schemes' interest in the sector, as they would no longer fear being blamed for individual events such as tenant evictions, according to John Lewis.
Andrew Chapman, pension investment manager at the retailer's pension trust, said the current environment - whereby the law was partial to the rights of investors rather than occupiers - was "untenable" given the economic climate.
Addressing delegates at an event hosted by the UK National Association of Pension Funds, Chapman said no scheme wanted to be held responsible for evicting "some widow in her whites" and called for a separation between pension fund and tenant.
"It that were properly addressed so we weren't held responsible in that way, it would be attractive in the current economic circumstances," he said.
Chapman warned that legislation as it currently existed in England and Wales was "almost too favourable" to property investors, and that the situation would need to change.
"In the longer run, the current situation is untenable," he said. "I say this as an owner of property. [The law] is too much in our favour. There has to be more sharing of pain in downturns between owners and tenants."
He said that there was a "degree of conspiracy" on part of the property industry, as offering concessions to struggling small retailers would undermine the owner's overall portfolio.
"You're not going to do that, no matter how much sympathy you might have for that particular tenant," he said.
Asked by a delegate about the use of Real Estate Investment Trusts (REITs) as a way of gaining exposure to property, he appeared sceptical and said the UK market was not developed enough.
"It's a chicken and egg to some degree, but, until participants participate in and really create a market in this country - and I know it's quite big in the US - then I just don't think it's going anywhere," he said.
Fellow panellist Dermot Kiernan, fund manager at M&G Investments, said REITs offered some advantages, but also downsides compared with direct holdings.
He argued that real estate equities had grown in the UK since the advent of REITs, but added: "It is cheap, it is very liquid, but the main issue is really about volatility and the loss of correlation you get with direct real estate - that's the main downside."