This year, our selection taps into the trend for more holistic returns
Commercial
.jpg "Image treatment")
The UK needs to reskill large parts of its workforce, yet has huge public spending challenges. What could be better for fulfilling the S in your ESG strategy than providing space for people to learn in? Expect to see growth in standalone education assets and university campuses.
Global demand is forecast to grow at more than 13% per annum over the period 2020-2027. Heightened interest in data security and environmental impacts will also drive rapid change in this sector.
Residential
.jpg "Image treatment")
Driven by the ability to deliver inflation-linked, long-term income that plays well to the S in ESG, we believe that annuity investors could increase their lending to housing associations from £87bn to £130bn by 2026. In addition, we believe for-profit registered providers could commit £23bn to the delivery of 130,000 new homes across a variety of tenures by the same date.
Last year, we picked Single Family Build to Rent as one of our top picks. And in 2021 we saw significantly increased investment in this sector. But such is the scale of the opportunity, we believe it remains fundamentally undersupplied. Buy-to-let investors, who have been the primary source of this rental stock, face continued regulatory pressures. These include prospective costs of getting to a minimum EPC C rating and the (delayed) abolition of s21 ‘no fault evictions’, both matters which institutional investors are better placed to accommodate.
Rural
.jpg "Image treatment")
These are schemes that decarbonise rural energy sources that are particularly dependent on oil and offgrid gas. Getting the right mix of locally generated renewables to provide long-term secure heating and energy to rural homes – where profits could be reinvested in subsidised rents – is crucial.
This is the lump in the middle of the land grades, and showing the least growth of all the land asset classes. However, it is versatile for a range of future star crops, such as biomass for energy and manufacturing materials like hemp.
5 other article(s) in this publication
.jpg)
.jpg)
.jpg)
.jpg)
.jpg)