The case for PACE
Download The case for PACE
The TM Gravis UK Listed Property Fund focuses on the next generation of real estate primarily through investments in real estate investment trusts (REITs). Targeting four key mega trends – ageing population, digitalisation, generation rent, and urbanisation – the Fund aims to generate attractive returns for investors.
You can read more about the four mega trends below.
The TM Gravis UK Listed Property Fund is focused on the future of real estate, targeting four key megatrends: an ageing population, digitalisation, generation rent, and urbanisation. Backed by robust secular forces, these trends are expected to generate attractive medium-term returns for investors.
The profile of the UK’s population is changing. Life expectancy has increased dramatically over the last few decades, and this is having an enormous impact on the infrastructure required to service an aging population.
The over 85s is the fastest growing cohort in the UK and it's estimated that its number will double to 3.4 million by 2047*. As people over 85 will, on average, use healthcare services more than 10 times per year**, demand for the services they depend upon will naturally increase. That means more demand for hospitals, doctors’ surgeries and care homes.
*Source: National population projections - Office for National Statistics
**Source: Use of primary care and other healthcare services between age 85 and 90 years - PubMed
From streaming and online shopping to artificial intelligence (AI), the UK economy is becoming ever more data hungry and digitally connected. And behind the apps and algorithms sits a physical layer of real assets such as modern warehouses, data centres, self storage facilities, telecoms towers and fibre networks, that make this shift possible.
Like ageing population, generation rent is another mega trend being driven by powerful demographics that intersect with multiple real estate sub sectors.
The number of 18-year olds in the UK is expected to grow considerably by 2030*, and with more university-age people in the UK, demand for purpose-build student accommodation (PBSA) is expected to rise. What’s more, today’s students, having become accustomed to the high quality offering of PBSA providers, become tomorrow’s tenants in the private rented sector (PRS), opting for the convenience of renting from professional landlords over the hassle of buying. This generation is also spearheading a shift in consumption preferences away from material goods, towards the experience economy**.
*Source: Journey to a Million | UCAS
**Source: Welcome to the Experience Economy
At the most recent count, more than 80% of the UK’s population live in urban areas*. However, this mega trend is less about the quantity of people living and working in cities, and more about the quality of space which they occupy.
Although cities consist of all types of properties, from retail to residential, it is the prevalence of offices that ultimately distinguishes urban areas from rural ones. And in recent years the office sector has been impacted by two separate but related trends: the rise of hybrid work and a growing focus on sustainability, the former thanks to the pandemic and the latter due to both regulation and tenant demand. There has been a flight to quality, with demand for the best space remaining robust, whilst older, lower quality buildings risk becoming stranded assets.
*Source: Urban population (% of total population) - United Kingdom | Data
In this episode of IFA Talk, hosts Jenny Hunter and Sue Whitbread from IFA Magazine discuss the current landscape of real estate investment with Matthew Norris, manager of the TM Gravis UK Listed Property (PAIF) Fund. The conversation covers seven key factors influencing real estate, including the effects of declining interest rates, rising rents, limited new supply, and discounted valuations.
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