There are distinct advantages in upcycling real estate, and this insight will unpack the following key themes:
Over the last two years or so there has been a seismic change in the UK pension scheme investment landscape.
Renewable infrastructure is an increasingly popular asset class among institutional investors, with a recent AlphaReal survey highlighting that over 90% of UK pension funds and insurers are looking to increase their allocations over 2024.
Renewable infrastructure assets continue to be deployed at pace across the UK as the country races to achieve net zero by 2050 and decarbonise the electricity system by 2035. Consequently, renewable electricity generation has increased fivefold since 2010.
Commercial Ground Rents (‘CGR’) provide investors with index linked cashflows that have bond-like characteristics and offer property owners an attractive form of long-term finance. The parties to a CGR are akin to a borrower and lender, although the relationship is governed by a lease not a loan.