Our fees are among the lowest in the country
Our Income account won Money magazine's Best Balanced Pension Product for 2020.
Apartments, or multifamily real estate assets, have not been an ingredient in the property investment mix for QSuper. Indeed, the QSuper Board has previously rejected opportunities to invest in the asset class both in Australia and in the United States. But European apartments may be a different story.
Since QSuper first invested in overseas property in 2006, as part of all of our diversified choices at the time, our international holdings to reduce geographic risk has expanded.
International real estate has continuously formed part of those options since it was initiated, and is now also a part of the Lifetime option that wasn’t available in 2006.
Australian real estate assets today account for around 70% of the Fund’s property investments, but Europe and the United States each make up about 15% of the QSuper real-estate portfolio.1
When QSuper moved to invest in real estate outside of Australia, it has been done progressively and with strategic partners. It’s not the same people buying property in Australia who are buying property in other global markets. Engaging with global investment partners is designed to efficiently and quickly extend QSuper’s reach from Brisbane across the globe, across different economic cycles and across different asset classes. And QSuper uses the expertise the investment partners have already established in those markets, to invest in global real estate assets.
The partnerships are not unique, but perhaps unusual compared to other funds in that QSuper has only a limited number of investment partners working for the QSuper Board. As a result, those partnerships are larger and may be considered more strategically significant.
Recently, one of QSuper’s real estate investment partners, AEW Europe, raised the prospect of investing in European apartment buildings. AEW Europe is one of the world’s largest real estate asset managers. Its $65 billion in assets under management range from London to Lyon.
Elsewhere, QSuper has avoided the multifamily housing sector.
In Australia, the thinking was that the sector was overbuilt, reducing prospects for future returns. With our strategic partners, the QSuper Board also investigated multifamily housing in the US, but vetoed that idea because so many investors were chasing those assets.
However, the housing picture in Europe differs significantly from the one in Australia and the US. In much of Europe, demand for multifamily housing outstrips supply, boosting return prospects. Demographics and cultural changes are also pushing more Europeans into smaller family units. Return prospects are surprisingly strong in the United Kingdom, where, despite the challenges of Brexit, spending is expected to rebound from current austerity measures.
The QSuper Board hasn’t decided whether to commit funds there yet. However, it is one of the new, and sometimes surprising, directions working with global investment partners can take the Fund.
Source: Savills World Research European Multifamily report, November 2017, http://pdf.savills.com/documents/Savills_European_Multifamily_report_Nov2017.pdf Accessed 1 February 2018.
Hear from the CEO of AEW Europe, Rob Wilkinson, as he gives insights into the European property market.
While QSuper weighs whether to invest in European multifamily housing, AEW Europe also recently encouraged the QSuper Board to take a stake in logistics warehouses in Poland, an investment that is earning about 9% a year.
AEW Europe continues to see this sector as attractive as e-commerce or online retailing giants such as Amazon expand, requiring large warehouses where goods are stored before being distributed.
1 The term ‘QSuper portfolio’ is used to refer collectively to the underlying portfolios of assets which in combination make up the individual asset allocations of QSuper Lifetime and the Balanced, Moderate and Aggressive investment options.
The views of the author are not necessarily the views of the QSuper Board. We’ve put this information together as general information only and you should get professional advice before relying on this information. Past performance is not a reliable indicator of future performance. Each of our investment options has a different objective, risk profile, and asset allocation. Head over to our website at qsuper.qld.gov.au to find out more.
If you’re seeking more of a controlling interest in the strategy and direction of your retirement investments within the supportive QSuper environment, there is a way you can invest yourself.
QSuper’s Annual Investment Update provides insights and information about the way QSuper manages your investments. QSuper Chief Investment Officer Brad Holzberger explores some of the common questions he was asked by members during this year’s Investment Update roadshow.
An equity-heavy fund creates a rollercoaster of returns for its members; up when equities do well and down when equities do badly.