UK - Aberdeen Property Investors is urging schemes to increase property allocations and predicts they will return approximately 7.8% per annum over the next 30 years.
The Investment Property Databank said property has been the best-performing asset class over the past decade, returning 11.5% compared to the 6.6% posted by equities.
Providing yields remain unchanged going forward, it predicts that returns will be similar to the current property yield of 6.3% plus income growth of 2.5%, net of depreciation and costs.
Chief executive David Hunter said: “This performance, coupled with relatively low volatility and diversification attributes, more than justifies property’s place in a multi-asset investment portfolio.”
He added that schemes are increasingly turning to this asset class because of property’s strong long-term performance and trustees’ needs to ensure that solvency can be covered and future payouts sustained as funds mature.
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers