A range of funding sources
Unlike conventional lenders, we have access to a number of different funding sources.
We can access each to deliver loan capital from £10 million to over £250 million against a single property asset. Each source of capital also brings specialist insight from industry-specific knowledge to development expertise.
Source 1: the Lime Property Fund
Created in 2004 for pension schemes as an alternative to investing in fixed income, the fund has grown to become a mature portfolio of c. £3.5 billion invested across 89 assets*. Its target is to deliver a stable, committed and predictable return in excess of gilts.
It seeks to reduce market risk through focusing on:
- Investment grade or equivalent covenants
- Lease lengths of 20 years+
- Inflation-linked and fixed-uplift reviews
- Long-term relationships, not short-term trading opportunities
- All sectors considered including non-traditional commercial sectors
Source 2: the REaLM Funds
Four open-ended funds covering commercial assets, ground rents and social housing.
- UK pension scheme investor base
The Funds seeks to reduce market risk through focusing on:
- Investment grade or equivalent covenants
- Lease lengths of 25 years+
- Inflation-linked leases i.e. RPI or CPI
- Preference for assets with no residual interest or where the tenant has the right to buy back the property at the end of the lease for a nominal amount – ‘income strips’
- All sectors considered including non-traditional commercial sectors
Source 3: bespoke segregated client mandates
- UK pension schemes
- c. £500 million
- Strong tenant covenants, preferably investment grade
- Lease lengths of 20 years+
- Inflation-linked and fixed uplifts / reviews
- All sectors considered including non-traditional commercial sectors
Source 4: the Aviva Plc Annuity Business
Aviva plc has long been one of the UK’s largest annuity managers. Our Real Estate Long Income business provides long-term, sterling-denominated, inflation-linked income to our annuity business.
Our annuity book targets longer-dated transactions with leases of up to 50 years. These multi-decade leases are especially well suited to matching long-term liabilities like those in an annuity business.
Source 5: European Real Estate Long Income Fund (E-RELI)
Created in 2017 this fund aims to deliver secure, predictable cash flow from predominately index-linked leases.
The portfolio will consist of Continental European (excluding UK) properties with an initial focus on office, retail and alternative sectors in Benelux, Germany, Nordics, France and Ireland.
The assets will be long-leased to high quality tenants with remaining lease terms of typically at least 15 years.
* Source: Aviva Investors as at 11 June 2022.
** Source: Aviva Investors as at 11 June 2022.