Vert Asset Management has launched the Vert Global Sustainable Real Estate Fund, an open-end mutual fund that seeks to achieve long-term capital appreciation by investing across the globe in publicly listed REITs using evidence-based environmental, social and governance (ESG) metrics.
“We are the first sustainable real estate mutual fund available to U.S. investors. Financial advisers are looking for more choices in ESG funds to round out their asset allocations. They’ve asked us for a pure real estate fund that meets their clients’ preference for sustainability,” said Sam Adams, Vert CEO and co-founder.
The fund’s proprietary ESG research methodology integrates academic research, industry best practice, and third-party data to evaluate companies for sustainability. The portfolio will buy REITs that are committed to sustainability. The fund uses a long-term buy-and-hold strategy, and companies are held at approximately market cap weights to maintain diversification and reduce turnover.
“The rapidly increasing commitment to ESG investing by institutional investors suggests otherwise,” said Dan Wheeler, Vert advisory board member. “With Vert, individual investors and their advisers will now have access to the real estate asset class on an ESG basis.”
“We wanted to create a fund that delivers the real estate market return but that only invests in sustainable companies,” added Professor Franz Fuerst, a member of Vert’s Investment Research Group.
The fund is subadvised by Dimensional Fund Advisors LP. Vert designed the fund strategy and oversees the eligible universe of securities, and Dimensional is focused on the implementation of the strategy.
Professor Gary Pivo, a member of Vert’s Investment Research Group, said, “Real estate has a huge impact on the environment, but it’s also a huge opportunity; buildings generate 25 percent of global greenhouse gas emissions, but reducing those emissions by reducing energy use is often very profitable. Many REITs are taking advantage of this, but many more could take advantage of this opportunity. A mutual fund available to mainstream investors is what the real estate market needs to move towards more sustainable practices.”
