GENERAL PROPERTY

Savills IM tops 21b AUM, eyes Japan multifamily residential

Tokyo Shibuya (Photo: Sean Pavone)
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IN spite of the global pandemic, Savills Investment Management racked up over EUR 2.5 billion in 2020 globally, bringing the firm’s assets under management up to a record EUR 21.2 billion.

Savills managed to transact more around EUR 2.1 billion in Europe and EUR 457 million in Asia. This was made up of EUR 1.7 billion in acquisitions and EUR  833 million in disposals for a net investment of EUR 842 million.

This was made of a cumulative 74 transactions in 14 countries, 8 of these transactions were in excess of EUR 100 million.

“The impacts of COVID-19 are unfortunately continuing into 2021, but they will subside. If investors can see through the short-term effects of the pandemic then they can leverage longer term themes to their advantage,”

Logistics performed unsurprisingly well, with Savills IM’s European logistics platform which achieved around EUR 4.7 billion in assets under the management.

“There are opportunities in market sectors showing greater resilience, such as logistics, residential and food retail. Given the lower-for-longer interest rate environment, the yields available in real estate are all the more attractive,” said Alex Jeffrey, global chief executive of Savills IM.

During 2020 Savills IM also expanded further into the pan-Asian region, launching their first open ended core fund in Asia, with their Asia Pacific Income and Growth fund.

Additionally, the firm opened their fourth Japanese fund, the Japan Residential Fund II, following the close of their Japan Value Fund II. The new fund will be discretionary with a long-term investment horizon, targeting the defensive Japanese residential sector.

“Japan remains a key destination for institutional investors, more so in the multifamily sector than ever before,” said Tom Silecchia, co-head of Savills IM, Japan.

Amongst investments in the region Savills acquired a portfolio of nine residential assets in Greater Tokyo.

“At this stage in the cycle, mid-market multifamily residential is seen as very stable and defensive. The significant weight of capital targeting this sector suggests yields will remain under downward pressure,” continued Silecchia.

In light of the global pandemic and resulting recession, throughout 2020 Savills IM focused on recession resilient sectors. Launching new funds such as a pan-European logistics fund, VESALF I, as well as the European Food Retail Fund.

“The impacts of COVID-19 are unfortunately continuing into 2021, but they will subside. If investors can see through the short-term effects of the pandemic then they can leverage longer term themes to their advantage,” said Jeffrey.

“These opportunities are best identified by experts on the ground with strong local knowledge, which is why we place so much importance on having a network of 17 offices in 13 countries,” he concluded.

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