The Fund’s approach to ESG:Environmental, social and governance (ESG) factors are taken into account in the selection, retention or realisation of investments in the Fund, but the extent to which any one of these factors is considered for any particular investment decision will vary at the discretion of the Investment Manager when managing this Fund, and in certain circumstances, the Investment Manager may not consider these factors to be relevant to a particular investment decision. The ESG approach for this Fund may differ to other funds managed by the Investment Manager. The Investment Manager utilises its proprietary ESG analysis for a two-stage approach to analyse the companies. A company’s commitment to carbon emission reductions is assessed in the initial screen of companies used to determine the investible universe and the exclusion of companies from the investment universe. All company analysis include ESG issues that directly influence the company valuation framework. A higher ESG characteristic assessment leads to a higher target valuation and positive selection of that asset. An ESG characteristic assessment score of below 2 out of 5 for ESG factors will lead to a company being excluded from the investment universe. The environmental characteristics considered as part of an ESG characteristic assessment include reduction of carbon emissions, water usage and waste management. In analysing the companies the Investment Manager considers the measures the companies are taking to achieve and implement carbon reductions through e.g. carbon offset schemes, onsite energy reduction, renewable energy procurement as well as modernisation efforts involved in improving the ongoing operational carbon reductions and reducing embodied carbon emissions through use of green materials and end of life recycling. Equally, the nature of property assets are inherently long term, making climate change a material issue for long term property asset valuation. The Investment Manager focusses on assessing each company considered for investment including how each company prioritises the potential impacts of climate change.In considering the social characteristics such as gender diversity, equal opportunity and community initiatives the Investment Manager expects companies to demonstrate diversity of gender, age and ethnicity across their organisation. Corporate governance characteristics such as Board independence and diverse skills and experience are assessed and rated. The ongoing monitoring and valuing of the ESG characteristics are embedded into the investment process and the proprietary scores are taken into account in the selection, retention and realisation of investments in the Fund. The Investment Manager will proactively engage with companies where it is of the view that the investee company is not making sufficient progress on the ESG characteristics.

We believe that listed property returns are driven by local real estate fundamentals and broader capital market conditions. We invest in high quality urban infill assets in high barrier to entry markets in the world’s most bustling cities.

We believe there is a strong correlation between responsible investing considerations such as Environmental, Social and Corporate Governance considerations and share price returns.

We use rigorous risk assessment in order to deliver real estate- based returns through the cycle while preserving client capital.

Our global listed property portfolio portfolios tend to deliver outperformance during falling markets.

ESG considerations across Environmental, Social and Governance factors are directly integrated into the investment process driving stock valuation outcomes.

Our investment style is active and focused on stock fundamentals and ESG considerations, with the flexibility to take a conviction-based approach where pricing anomalies warrant. The investment time horizon is over the medium to long term. Valuation methodologies are implemented on a through-the-cycle basis with a strong ESG bias.

A defined initial screen is applied to the greater investment universe. Each stock/market in the universe must pass every screening variable in order to be considered eligible for investment. Those variables are absolute back stop limits and will not change on a through-the-cycle basis. When deemed appropriate the back stop limits can be tightened. However the limits will not be loosened beyond these levels. 

Any security which passes the initial screen then undergoes a process of fundamental, bottom up research, involving the assessment of physical real estate markets and stock forecasting. Stock forecasts include 5-year Funds from Operations (FFO) forecasts, 5-year cashflow forecasts and balance sheet forecasts. This process enables us to determine each stock’s current and future private market value. As a part of all stock due diligence, full operational and embodied carbon analysis must be undertaken on the stock providing detailed carbon characteristics and net zero forecasts. ESG assessments are also undertaken across a range of environmental, social and governance factors.