U.K. pension funds increasingly look to residential property

Defined benefit (DB) pension schemes will increasingly look to U.K. residential-property development, supporting the drive to deliver housebuilding targets for the country, according to new research from investment manager Downing LLP.

The research showed as much as 86 percent of U.K. pension funds expect investment in residential-property development to increase during the next five years, with nearly one in five (18 percent) forecasting a dramatic increase.

Downing’s study with U.K. pension funds, which collectively control about £125.5 billion (€149.8 billion/$152.5 billion) in assets under management, found more than three out of four (78 percent) believe the United Kingdom’s target for housebuilding can only be met if institutional investors become more involved in funding.

Pension schemes recognize they have a part to play in meeting the growing demand for residential housing, the research found, with 86 percent questioned saying that DB schemes can