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| UK pension funds keep faith with commercial property sector The Pensions Management Institute (PMI) one of the largest representatives of UK pensions trustees, and Prupim, a leading global real estate investment manager have joined forces to produce a research report titled "Real Estate Investment: What's on the Horizon". Launched at the PMI Autumn Conference, the report reveals that over 25% of UK pension funds are planning to increase their asset allocation to commercial property and over 50% will maintain their current allocation over the medium term. The research has shown that pension funds still value the diversification and the relatively steady and occasionally high returns that real estate can offer as an asset class. The PMI and Prupim's latest research into UK pension funds also revealed that unlike their typically core, core-plus approach to UK property investment, when investing overseas many move up the risk spectrum and seek out 'value-added' and 'opportunistic' investment returns. Almost 50% of pension funds surveyed who have invested in real estate now have exposure to real estate markets outside the UK. This represents something of a sea-change taking place over the last decade for the asset class. The report also confirmed that Europe is by far the preferred region for such investors. The research was conducted in June 2008 through a survey of 200 UK pension fund managers, trustees and investment consultants and a series of in-depth interviews. In addition, UK pension funds revealed that, by far, the most important reason they invest or consider investing in real estate is for the diversification benefits due to its low correlation of returns with other asset classes. write your comments about the article :: © 2008 Construction News :: home page |