The Swiss Life Investment Foundation and Swiss Life Asset Managers are expanding their product range with an investment solution for industrial and logistics real estate in Europe. The target group of this offering is made up of Swiss pension funds and institutional investors aiming to invest in a segment with attractive growth prospects.
The offer comprises two investment groups from the Investment Foundation for Swiss Pension Funds which are available either in EUR or in CHF with foreign currency hedging, as well as a Luxembourg fund for institutional investors. The "Real Estate Europe Industry and Logistics" investment groups are investing in a diversified and high-quality portfolio of industrial and logistics real estate in Europe through the new fund "Swiss Life Real Estate Funds (LUX) S.A., SICAV-SIF – European Industrial & Logistics."
The focus is on Germany and France but also includes properties in the rest of Europe, especially in the UK, Benelux and Switzerland. Roughly half of the assets are to be invested in industrial and the other half in logistics properties. This innovative approach combines the advantages of both real estate asset classes: the high diversification of rental income and the flexibility of use of industrial real estate with the earnings strength and the high demand for space offered by logistics real estate.
Industrial real estate is mainly represented by mixed-use commercial properties whose tenants are typically from the SME segment. Types of use include floorspace for manufacturing, storage, office, research and service-sector uses. The typical multi-tenant structure and large number of use types make for good risk diversification at the property level. The logistics properties generally feature large amounts of floorspace and occupy locations in European
metropolitan regions offering particularly good access for warehousing, distribution and order-picking activities.
Advantages of industrial & logistics real estate investments
Industrial & logistics properties are characterised by stable returns. In the case of industrial real estate, this is due to the above-average granularity of rental income. The combination with the steadily growing demand for logistics properties enables an actively managed defensive strategy that institutional investors value in the current market environment. At the same time, there is long-term growth potential, as the industry & logistics segment will benefit from megatrends such as e-commerce, urban logistics, Industry 4.0 and deglobalisation in the coming years. The mix of small-scale industrial and large-scale logistics properties points to an above-average return with below-average earnings fluctuation compared to pure logistics real estate investments.
Long-term experience in the industrial & logistics investment segment
Swiss Life Asset Managers has successfully expanded its third-party business in recent years. As at the end of June, real estate assets under management totalled CHF 99.7 billion. Together with the investments of Swiss Life's insurance companies, Swiss Life Asset Managers has assets of approximately CHF 256 billion under administration. BEOS AG – part of Swiss Life Asset Managers since 2018 – is a specialist and market leader in Germany for the development and management of industrial and logistics real estate. It operates within Swiss Life Asset Managers as a European centre of expertise for this real estate asset class. As at the end of 2020, BEOS solely managed over CHF 4.6 billion in assets in this investment segment.
Information on the fund
|Name||Swiss Life Real Estate Funds (LUX) S.A., SICAV-SIF – European Industrial & Logistics
||Diversified portfolio of industrial and logistics real estate in Europe
|Foreign exchange hedging
|ISIN | Swiss security number||ISIN LU2189783710 | Swiss security no. 56637679|
|Legal form||Specialised investment fund in the form of a public limited company under Luxembourg law
|Alternative Investment Fund Manager (AIFM)||Swiss Life Asset Managers Luxembourg|
|Custodian bank||Brown Brothers Harriman (Luxembourg) S.C.A.|
Information on the investment groups
|Name||Real Estate Europe Industry and Logistics (EUR)
||Real Estate Europe Industry and Logistics (CHF)
||Diversified portfolio of industrial and logistics real estate in Europe through investment via Swiss Life Real Estate Funds (LUX) S.A., SICAV-SIF – European Industrial & Logistics
|Foreign exchange hedging||No||Yes, at least 80% of FX risks should be hedged against CHF
|ISIN | Swiss security number||ISIN: CH0568481409 / Swiss security no.: 56848140||ISIN: CH0568479858 / Swiss security no.: 56847985|
|Investment category||Real estate (in accordance with Art. 53, cl. 1c BVV 2)
|Investment foundation||Swiss Life Investment Foundation
|Portfolio manager||Swiss Life Asset Management Ltd|
|Custodian bank||UBS Switzerland AG|