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Global Cities

Helping you invest in companies that own the best real assets in the strongest locations

Schroder ISF Global Cities

Global Cities are places where people want to live, work and play. Their key characteristics are: strong infrastructure; diverse economies; skilled labour force; and quality of life and culture. Investing in real estate within these cities gives exposure to a diverse range of sectors and access to economies that are expected to outperform national averages.

Easy access to property

Real estate companies are listed on stock exchanges, meaning they’re tradeable securities – a partial share in the underlying properties.

Owning property directly has limitations:

  • A large lump sum of capital is required to purchase
  • A lack of diversification (tenant and geographic risk)
  • High transaction and management costs.

And while the shares of real estate companies can move up and down on a day-to-day basis, their returns look similar to directly-invested real estate over the long-term.

Exposure to commercial real estate

Going global can help provide diversification away from owning only property in one country.

Risk is spread across a number of properties and companies, rather than relying on the success of one or two. Global Cities’ investments rely on identifying the best operators in locations where the economic demand is greatest. This results in higher rents, the bedrock of real estate investing.

The team believes these cities are the real estate ‘winners’ of tomorrow as they could be home to the most in-demand real estate.

Access cutting-edge data insights

Data is at the heart of the index and the team use data to give them an active edge.

This approach is unique in listed real estate investing and is the foundation of the Global Cities' approach.

The team has a database and can identify the location of all the assets held in the portfolio. This means each company held has a Global Cities score: the higher the score the more likely a company is to be in the portfolio.

Capture urbanisation trends

Urbanisation will, in the team’s view, be one of the most important investment themes of the next 10 years. Global Cities sits at the centre of this theme.

Economic activity is centred in cities. Picking the cities that will gain greater share of the global economy will underpin the demand for the assets the team invests in. This long-term approach is crucial when investing in Global Cities.

The scale and diversity of the strongest Global Cities, means the team can invest in different real estate sectors, such as data centres, self-storage and manufactured homes. This is in addition to the more conventional real estate sectors such as offices, retail and industrial.

Choice means the team can gain exposure to pockets of demand both in a sub-sector and a city, without incurring the challenge of liquidity and transaction costs of a direct real estate fund.

Benefit from exposure across multiple-channels 

Schroders Global Cities invests in real estate companies across:

  • Residential
  • Retail
  • Office
  • Data centres
  • Storage
  • Industrial

Risk Considerations

  • The capital is not guaranteed.
  • Investments denominated in a currency other than that of the share-class may not be hedged.
  • The market movements between those currencies will impact the share-class.
  • Investments in small companies can be difficult to sell quickly which may affect the value of the fund and, in extreme market conditions, its ability to meet redemption requests upon demand.
  • The fund will not hedge its market risk in a down cycle. The value of the fund will move similarly to the markets.
  • Changes in China's political, legal, economic or tax policies could cause losses or higher costs for the fund

Important informationThis document does not constitute an offer to anyone, or a solicitation by anyone, to subscribe for shares of Schroder International Selection Fund (the “Company”). Nothing in this document should be construed as advice and is therefore not a recommendation to buy or sell shares.

Subscriptions for shares of the Company can only be made on the basis of its latest Key Investor Information Document and prospectus, together with the latest audited annual report (and subsequent unaudited semi-annual report, if published), copies of which can be obtained, free of charge, from Schroder Investment Management (Europe) S.A.

An investment in the Company entails risks, which are fully described in the prospectus.

Past performance is not a reliable indicator of future results, prices of shares and the income from them may fall as well as rise and investors may not get the amount originally invested.
Schroders has expressed its own views and opinions in this document and these may change.

Schroders will be a data controller in respect of your personal data. For information on how Schroders might process your personal data, please view our Privacy Policy available at www.schroders.com/en/privacy-policy or on request should you not have access to this webpage.

This document is issued by Schroder Investment Management (Europe) S.A., 5, rue Höhenhof, L-1736 Senningerberg, Luxembourg. Registered No. B 37.799. For your security, communications may be taped or monitored.

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