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Overview

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Diversification is the main reason why pension schemes invest in property. Evidence shows that including property within a multi-asset portfolio can enhance the risk-adjusted returns of the whole portfolio. 

There are various routes to investing in property. The largest institutional investors can buy physical properties, although most pension schemes favour pooled funds or multi-manager solutions. These approaches bring risks of underperformance and illiquidity, while the high costs of trading means schemes rarely switch providers until it is too late. 

The unique nature of property as an asset class has limited the development of index-tracking solutions – until now. The Active Beta Property Fund is a pooled pension fund which aims to track the UK commercial property funds market. By taking small, active positions across a range of balanced property funds, we aim to deliver returns with a risk profile that is appropriate for UK pension schemes investing in property as a diversifying asset class. 

  Key Fund Details
Fund domiciled in: United Kingdom
Launch date: 30-06-2017
Benchmark: IPD UK All Balanced Property Fund Index
Performance target: To perform in line with the benchmark with a tracking error of less than 1%

Unlocking property market returns for DB and DC pension schemes


The 2021 PLSA Investment Conference took place from 9-11 March. Tony Yu of Aegon AM’s Indirect Property Team presented a session titled ‘Unlocking property market returns for DB and DC schemes’.


While the benefits of investing in commercial property as part of a diversified multi-asset portfolio are widely understood, its illiquid nature means that just 30% of DC schemes invest in it, versus 63% for DB. Tony demonstrates how property can deliver stable, attractive returns for both types of pension investors. 

Documents

Quick Access

All documents

Finding a home for property in DC pensions.pdf

(396KB) PDF

Aegon Active Beta DC Property Fund (March 2021).pdf

(431KB) PDF

Three-year Anniversary Review.pdf

(279KB) PDF

Fund managers

Mark Bunney

Mark Bunney

Head of Indirect Property

Mark Bunney is Head of the Indirect Property team, and is a fund manager with responsibility for client accounts and fund research.

Full profile
Tony Yu

Tony Yu

Fund Manager, Property

Tony Yu is a fund manager in the property team, responsible for developing portfolio strategies

Full profile

Contact

Institutional Business Development Manager (Property)

Shaun Mcwilliam

Institutional Business Development Manager (Property)


shaun.mcwilliam@aegonam.com