Covid-19: A message from our Chief Investment Officer, Tim Munn (March 2020)

25 March 2020

To our valued clients, colleagues and friends in the property industry. These are unprecedented times and we appreciate that, with increased uncertainty and disruption, investors will be concerned. We are proud stewards of the funds entrusted to us by our clients and will be doing all that is necessary to protect their interests. Our leadership team is tracking events closely, we have robust systems in place to continue our operations and are continually communicating with our extensive market network.

We expect market activity – both investment and leasing - to reduce dramatically as restrictions on movement tighten. There is limited evidence of transactions completing over the last two weeks, but these are generally deals that were agreed some weeks ago and had momentum with the vast majority of due diligence already undertaken. Some investment transactions have completed at reduced prices, particularly in the retail sector where structural conditions have been weak for some time and prospects are continuing to deteriorate. Other live investment transactions, in the office, industrial and residential sectors, either appear to have been put on hold or are progressing at a slower pace. We are monitoring these transactions closely as we attempt to ascertain pricing in the current market.

Given the unknown future impact that COVID-19 might have on the real estate market the leading valuers have introduced an industry agreed “material uncertainty” clause into their valuation certificates, which will effectively qualify their valuations. Under new FCA rules, when reported valuations are qualified on the basis of material uncertainty, authorised fund managers are required to suspend dealing until such time as liquidity improves. This measure is designed to protect the interests of investors and ensure all are treated equally, particularly regarding unit pricing. The majority of open-ended funds are therefore now closed.

Whilst not underplaying the seriousness of the situation and extensive disruption to markets, it should be acknowledged that real estate is a long term investment. Our thematic investment approach, focussed on secular trends in the global economy and identifying where future occupational demand will be strongest and sustained, will withstand short term shocks to the market. At our core, we are income-focussed investors and build portfolios that produce resilient and enduring cashflows. Accordingly, we remain focussed on income risk: keeping on top of vacancy, forthcoming lease expiries and tenant credit risk.

As part of this process we will be working very closely with our tenant customers during this unprecedented period, ensuring they get the support they need for their real estate requirements. We have provided guidance to our property managers to ensure a consistent and measured approach is taken in responding to requests from tenants for temporary rental concessions such as monthly payments and rent deferrals. In principle, we will be supportive of our tenants when they are able to demonstrate difficulties, whilst continuing to ensure the interests of our investors are protected.

We are committed to developing trusted partnerships with our clients. Accordingly, we acknowledge the importance of transparency and clear communication, especially during uncertain times. You can expect to receive regular updates from us as we continue to operate through this unprecedented period.

Download an updated Briefing Note authored by Frances Spence, our Director of Research, Strategy & Risk.

Terms & Conditions

This website is not suitable for retail clients

Information on this Site

The information on this site is issued by Swiss Life Asset Managers UK Limited ("Swiss Life Asset Managers UK"), a company incorporated in England and Wales under number 04846209, authorised and regulated by the Financial Conduct Authority ("FCA") with FRN 229228 and its registered office is at 55 Wells Street, London, W1T 3PT. Swiss Life Asset Managers UK is a member of Swiss Life Asset Managers.

The Property Income Trust for Charities (“PITCH”) is a pooled property vehicle, in the form of a UK exempt unauthorised unit trust, which is managed by Swiss Life Asset Managers UK.

The following terms and conditions apply to the use of this site. By using this site, you consent to these terms and conditions and the privacy policy and cookies policy available on this site. If you do not accept these terms and conditions, privacy policy and cookies policy, you must not use this site.

Sales Restrictions

PITCH is not a recognised collective investment scheme for the purposes of the Financial Services and Markets Act 2000 of the United Kingdom (the "Act"). The promotion and the distribution of offering materials in relation to PITCH in the United Kingdom is accordingly restricted by law.

PITCH is categorised by the FCA as a Non-Mainstream Pooled Investment which cannot be marketed to the general public. PITCH is only available to charities who qualify under section 96 or 100 of the Charities Act (2011) or section 25 of the Charities Act (Northern Ireland) 1964 (“Eligible Charity”).

PITCH is not regulated under the UK's financial services regulations and investors will not benefit from the rules and regulations made under the Act for the protection of investors as would apply to authorised schemes, or from the Financial Services Compensation Scheme.

The information on this site is for information purposes only and does not constitute an offer to sell or a solicitation of an offer to subscribe for units in PITCH. The information on this site does not constitute a recommendation or investment advice and should not be relied upon. Should you have any queries about PITCH, you should contact your financial adviser.

Risk Factors

The value of investments may go down as well as up, and investors may not get back all or any amount originally invested. Income or other returns from investments are subject to change and may be lower than estimated. Past performance is not a reliable indicator of future performance.

PITCH invests in real property in the UK and uses leverage which means the fund may be subject to higher risk and volatility than other funds and may not be suitable for all Eligible Charity investors. Further, PITCH’s portfolio of assets may lack diversification thereby increasing the risk of loss.

The levels and bases of and reliefs from taxation may change. Any tax reliefs referred to are those currently available and their value depends on the circumstances of the individual investor. Investors should consult their own tax adviser in order to understand any applicable tax consequences.

Accuracy of Information

Information on this site (including any expression of opinion or forecast) has been obtained from, or is based on, sources believed by Swiss Life Asset Managers UK to be reliable, but is not guaranteed as to its accuracy or completeness and should not be relied upon. The information is provided without obligation on the part of Swiss Life Asset Managers UK and on the understanding that any person who acts upon it or changes their investment position in reliance on it does so entirely at their own risk.

Information is current only as at the date it is first posted and may no longer be true or complete when viewed by you. All information may be changed or amended without prior notice although Swiss Life Asset Managers UK does not undertake to update this site regularly. Swiss Life Asset Managers UK shall not be obliged to remove any outdated information from the website or to expressly mark it as being outdated.

No Liability

Whilst reasonable steps have been taken to ensure the accuracy and completeness of the information on this site, no representation, warranty or undertaking is given as to the accuracy or completeness of the information by Swiss Life Asset Managers UK or any of its associated companies and no liability is accepted by such persons for the accuracy or completeness of such information. In no event will Swiss Life Asset Managers UK or any of its associated companies be liable to any person for any direct, indirect, special or consequential damages arising out of any use of the information, or on any other hyper-linked site, including, without limitation, any lost profits, business interruption, loss of programs or data on your equipment, or otherwise, even if Swiss Life Asset Managers UK is expressly advised of the possibility or likelihood of such damages. This does not exclude or restrict any duty or liability that Swiss Life Asset Managers UK has to its customers under the regulatory system in the United Kingdom.

You should be aware that the internet is not a completely reliable transmission medium and access to and use of this website is at your own risk. Swiss Life Asset Managers UK does not accept any liability for any data transmission errors such as data loss or damage or alteration of any kind, including, but not limited to any direct, indirect or consequential damage, arising out of the use of the products or services referred to herein. Furthermore, we accept no liability in respect of losses or damages arising out of changes made to the content of the website by unauthorised third parties. This does not exclude or restrict any duty or liability that Swiss Life Asset Managers UK has to its customers under the regulatory system in the United Kingdom.

Indemnity

You agree to indemnify, defend, and hold harmless Swiss Life Asset Managers UK and its directors, officers, employees, agents, licensors and affiliates from and against any and all claims, liabilities, damages, losses, or expenses, including legal fees and costs, arising out of or in any way connected with your access to or use of this website and the information.

Copyright, Trademarks and Other Rights

Copyright, trademarks, database rights, patents and all similar rights in this site and the information contained in it are owned by Swiss Life Asset Managers UK, its licensors or relevant third party providers. You may use the information and reproduce it in hard copy for your personal reference only. The information may not otherwise be reproduced, distributed, stored or transmitted without Swiss Life Asset Managers UK’s written consent. Nothing on this site should be considered as granting any licence or right under any trademark of Swiss Life Asset Managers UK or any third party.

Internet e-mail

Messages sent over the internet cannot be guaranteed to be completely secure. They could be intercepted, lost or possibly altered. Swiss Life Assset Managers UK cannot and will not take responsibility for this, and will not be liable to you or anyone else for any damages or otherwise, in connection with any message sent, either by you to Swiss Life Asset Managers UK, or by Swiss Life Asset Managers UK to you, over the Internet.

Linked Websites

This site may be linked to third party websites or contain information provided by third parties. These links are provided only as a convenience. Swiss Life Asset Managers UK does not make any representation as to the accuracy or completeness of such websites or information, has not and will not review or update such websites or information. You acknowledge and agree that, as you have chosen to enter the linked website, use made of such websites or information is at your own risk. Swiss Life Asset Managers UK does not accept any liability arising out of the information contained on any linked website or information provided by a third party and the use of such sites and information is at your own risk. This does not exclude or restrict any duty or liability that Swiss Life Asset Managers UK has to its customers under the regulatory system in the United Kingdom. You should also be aware that the terms and conditions of such website and the website's statement relating to the collection and use of your personal information may be different from those applicable to your use of this website.

Governing Law

You agree that your use of this site and any dispute arising from the use of this site is subject to English law and you submit to the jurisdiction of the English courts.