The European residential sector continues to grow. The increasing number of households leads to additional demand for housing and the old stock does not meet current and future requirements. The need for modern, institutional-quality residential real estate is equally high.
In Europe, urbanisation continues and the number of households is growing. The private rented sector (PRS) offers low correlation to other real estate sectors in the EU, stable regular income and benefits from the growing institutional investment market at European level.
Our pan-European living strategy seeks to take advantage of the long-term housing supply/demand imbalance and offers institutional investors the potential for long-term income generation.
The strategy provides access to a diversified pan-European residential open-ended portfolio. Aim is a gross income return of 4% p.a. and gross total return of 5.5% - 7.5% p.a. Please note there is no guarantee the target will be achieved.
We focus on
The Invesco Real Estate team’s investment approach focuses on large-scale, high quality opportunities in recognised locations within proven letting markets. These aspects are constantly monitored by the research team.
In addition, ESG considerations are fully integrated, from acquisition planning and development to ongoing property management.
Steps of the investment process
With 582 staff located in 21 offices and 16 countries globally, Invesco Real Estate is responsible for assets of around €80.7 billion (as of 31 December 2021). Our focus is on continually enhancing the investment outcomes we deliver to our clients.
The team works directly with contractors and developers. However, having a strong reputation, an experienced team and a strong track record allows them to source off-market opportunities, which they believe can be an important differentiator in the sector.
The team has a deep understanding of the European residential market and has established relationships with which to source the best opportunities to deliver attractive returns.
Opportunity or caution? The outlook for European real estate
Kevin Grundy, Managing Director, Fund Management, Europe, Invesco Real Estate, discusses the broader market environments in the region and where he is finding the most compelling investment potential for value-add and opportunistic strategies.
How global demographics drive global real estate opportunities
Global demographic shifts, like a declining, growing, or an aging population, in tandem with macroeconomic factors tend to generate real estate investment opportunities.
Real estate 2024 investment outlook
Investing through market corrections has historically driven outperformance for real estate investors. We believe this will continue into 2024.
Let us know using this form and one of our specialist team will quickly get back to you.
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.
Property and land can be difficult to sell, so investors may not be able to sell such investments when they want to. The value of property is generally a matter of an independent valuer’s opinion and may not be realised. Real estate investments are typically non listed on regulated markets and need to be valued via the application of appropriate models (potentially applied by independent experts). This may lead to inaccurate valuations which may not be reflected into transaction prices. Changes in interest rates, rental yields and general economic conditions may result in fluctuations in the value of the strategy. Real estate investments are exposed to counterparty risk, which is the risk that a counterpart is unable to deal with its obligations. The strategy may use derivatives (complex instruments) and borrowings, which may result in the strategy being significantly leveraged and may result in large fluctuations in the value of the strategy. Real estate investments can be exposed to new sustainability-related regulatory requirements that may negatively affect the value of those assets which are not compliant and can envisage significant costs to be invested to comply or to simply improve their sustainability profile. In addition, real estate investments can be also significantly exposed to negative economic effects stemming from climate change, natural disasters and the general preference of investors for assets with better sustainability features.
As the strategy invests only in the ‘living’ sector (both traditional residential and ‘alternative’ investments such as student housing and co-living), it may be exposed to specific sector’s volatility and value drops.
All data is provided as at 31 December 2021, sourced from Invesco, unless otherwise stated.
Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice.
This document does not form part of any prospectus. It contains general information only and does not take into account individual objectives, taxation position or individual financial needs. It does not constitute a recommendation of the suitability of any investment strategy for a particular investor. Nor does it constitute an offer or solicitation by anyone in any jurisdiction in which such an offer is not authorised or to any person to whom it is unlawful to make such an offer or solicitation.
