Article | Perspectives

Future-proofing Long Income for the Sustainable Revolution

Private Real Estate

01 Nov 2021 10 Minute Read Time

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Real Estate Long Income has a track record of providing real estate and fixed income investors with attractive risk-adjusted returns, whilst simultaneously providing inflation hedging characteristics and secure and long (20+ years) cashflow. Future-proofing assets, risks and returns have historically focused upon maintaining certainty of cashflow, and as a result, often asset-level characteristics were overlooked. Furthermore, in most cases, the occupier is responsible for all capital expenditure and maintenance, leading to a need for reduced owner management intensity. Whilst being seen as a benefit, this has historically left investors searching for a satisfactory answer in relation an investors’ ability to control and improve Environmental, Social & Governance (ESG) matters. It is now becoming increasingly clear that without proper attention, non-compliant properties will become stranded when leases expire. To manage the risk this presents, nimble management as well as access to a deep pool of knowledge and expertise, not just in Long Income, but also in sustainability best practice, are needed.