Our investment process has four phases and is implemented by the portfolio management team who are supported by the wider real estate team. They are:
We set an investment plan for each portfolio that provides a risk budget aligned with our investors’ and portfolio tolerance for risk and our view on the absolute value available in the market from various investment decisions. This top down strategy is developed based on input derived from Aberdeen’s global in-house research team and is guided by the investment plan set by the Investment Strategy Group.
We implement an investment plan through the identification of appropriate risks to form part of an overall risk budget, holding, selling and buying assets as appropriate. Aberdeen has an international transactions team that oversees the transaction process from sourcing/initial marketing until closing. Due diligence is also an essential component of the selection process, which focuses on detailed analysis of the individual property asset and an assessment of contribution it makes to the overall portfolio.
We manage risk within the real estate portfolio on a day-to-day basis in order to maximize the return for the given set of risks or to change those risks to take advantage of market circumstances. We believe the role of active management is essential in generating excess returns and we therefore focus on hands-on portfolio modelling, asset and property management once our investment has been made.
Performance is the market’s compensation for the risks taken in the portfolio. Through detailed analysis of the performance for each of our real estate portfolios we have the ability to learn more from our investment decisions.