Infrastructure and Real Estate: late-cycle solutions from Nordea Asset Management
LUXEMBOURG, LU – Nordea Asset Management (NAM) announces the launch of the Nordea 1 – Global Listed Infrastructure Fund (BP-USD, LU1947902109; BI-USD, LU1927026317) as well as a new manager for the Nordea 1 – Global Real Estate Fund (BP-USD, LU0705260189, BI-USD, LU0705259504).
After many years of economic expansion, it is no secret that we are reaching the end of the economic cycle. While investing in a late-cycle economy can be challenging, investors can still achieve good returns. With Nordea Asset Management investors have two strong solutions to face this inevitable scenario.
The recently launched Nordea 1 – Global Listed Infrastructure Fund, managed by CBRE Clarion Securities LLC, taps into the rising demand for new and existing infrastructure, which requires on-going investment to upgrade and replace. Listed infrastructure is a solid late-cycle alternative because the asset class provides a defensive and stable growth profile anchored by dividend income, as well as inflation-linked revenues and growth from reinvestment capital. Potential returns are further enhanced by the secular trend of sustainable development, which is heavily reliant on infrastructure investment.
The launch of Nordea’s new fund comes at a time when the asset manager has signed Duff & Phelps Investment Management Co. to take over the Nordea 1 – Global Real Estate Fund. The fund invests in listed real estate, which produces attractive returns over the long run and has historically been shown to lower portfolio risk and enhance returns. Real Estate represents another late-cycle opportunity as the asset class is supported by strong fundamentals, M&A and privatization, robust activities and discounted net asset values.
“Cash flows and dividends benefit from contractually driven, inflation-linked revenue growth, which may provide a long-term hedge against inflation and rising interest rates.”
— Jeremy Anagnos of CBRE Clarion Securities LLC
Manager of Nordea 1 – Global Listed Infrastructure Fund.
“Listed real estate has both stock- and bond-like characteristics, so it is considered defensive relative to the broader stock market. Because real estate has evolved as an asset class, we have found that management and corporate governance is stronger than in previous cycles. A more
sophisticated capital structure, lower debt levels and a closer focus on future supply
means that it should be able to better withstand a future economic downturn.”
— John Creswell, Executive Managing Director at Duff & Phelps Investment Management Co.
Manager of Nordea 1 – Global Real Estate Fund