The total fair value of assets in the DB scheme rose to £525.2m at the end of the 2013 accounting year from £463.9m the year before, but the present value of liabilities outpaced this increase, expanding to £613m from £547.8m.The DB scheme has been closed to new entrants since 2007, and pensions accrued since then have been on a career average revalued earnings basis, Barnardo’s said.Active members of the DB scheme have now become members of the defined contribution (DC) Barnardo’s Retirement Savings Plan for future service.The charity said benefits for members of the DB scheme would continue to increase broadly in line with inflation.Payments to the DB scheme that had been agreed within the recovery plan were budgeted and included in future cashflow projections, it said.Those payments will be made over a number of years, it said, adding that they did not require a reduction in the total funds shown in the balance sheet. The defined benefit (DB) pension scheme of UK children’s charity Barnardo’s has slid deeper into deficit in the last financial year, and the organisation has now closed the scheme to further DB accruals.In its 2013 annual report, Barnardo’s revealed that, in the year to the end of March, the Barnardo Staff Pension Scheme — which operates on a DB basis — had a funding shortfall of £87.8m (€104.2m), up from £83.9m the previous year.The report said: “This increase in the deficit reflects a continued deterioration in pension scheme funding across the UK.”The board of trustees of Barnardo’s and the trustees of the pension fund had agreed a plan to eliminate the deficit over time, it said, adding that this included the closure of the pension scheme to future accrual.
The appointment of a trustee in charge of Sweden’s SEK1trn (€113bn) AP Fund system will allow for a more flexible and dynamic investment strategy, according to the chairman of 2012’s Buffer Fund Inquiry.Mats Langensjö said it was a “major and important step” for a report by the cross-party Pension Group – which this week welcomed most of the Inquiry’s recommendations on the future of AP1 through AP, as well as AP6 – to accept the need to end the current arrangement that saw the buffer funds as both asset owners and managers.He said that the appointment of a principal in charge of all AP fund assets would allow for a much more flexible and dynamic investment structure than currently permitted by the investment rules laid down in law.“You can allocate more broadly to different asset classes, and allow the system to be more useful for the financing of the pensions,” he told IPE. Discussing the role of the principal, he said: “I think the most important thing is to express – and finally have someone to express – an objective for the entire system, which was not in place before.”However, Langensjö was less certain if the Pension Group should push ahead with its plans for a reference portfolio as a benchmarking tool, and warned that wrongly implemented, the proposal could again impose restrictions.“I would say that using a reference portfolio is an old-fashioned way of benchmarking – a more dynamic risk mandate is much more appropriate.” He said the issue would be down to the detail of the implementation, “so hopefully that’s going to be implemented in a modern and relevant way”.Langensjö, who until last year was the chief executive of Brummer Life, also argued that future buffer funds should not be seen as in direct competition with each other. “That’s an unnecessary peer group approach that should have been abolished many years ago, because it doesn’t have any use to the system,” he said, stressing that the need for the principal to look at the system, and its performance, in its entirety.
The joint venture is focusing on office buildings in San Francisco, Los Angeles, Boston, New York and Washington DC.The deal will be the joint venture’s fourth in the US and second in Boston, having bought the city’s One Financial Center (also from Beacon), Washington DC’s Thurmond Arnold building and 425 Market Street in San Francisco.In San Francisco, NBIM will pay around $350m for 405 Howard Street.Langley Investment Properties and GE Asset Management are selling the 521,000 sqft property, which is fully let.Based on current net operating income, the cap rate on the sale will be around 4%.All parties declined to comment. Norges Bank Investment Management (NBIM), which manages Norway’s sovereign wealth fund, is in talks to buy two office buildings in the US for $915m (€677m), according to sources.The properties in Boston and San Francisco are being bought in joint ventures with US insurer MetLife and TIAA-CREF, respectively.The Boston property – the 1m sqft One Beacon Street building – is expected to be sold for around $565m by Allianz Real Estate and Beacon Capital Partners, which bought the asset for its closed-end Strategic Partners IV fund in 2006.NBIM and MetLife’s joint venture, split 47.5% and 52.5%, has invested $2.26bn since its creation in December last year, with no target for future investment.
The Dutch Social and Economic Council (SER) has failed to produce a unanimous recommendation on the best way forward to building a new and sustainable pensions system in the Netherlands.The SER said individual pensions accrual, combined with collective risk-sharing, would be an “interesting” option for future pension arrangements.Dutch unions, however, have said they want to explore the concept of an improved version of the current defined benefit (DB) plan but with fewer guarantees.Gijs van Dijk, a board member at the FNV union, said: “For pension funds with low coverage ratios, this alternative will probably also allow for a more simple transition to a new system.” Meanwhile, Cees Oudshoorn, director of employer organisation VNO-NCW, said his members wanted a choice for “modern” defined contribution arrangements.In its report, the SER concluded that, in a system based on individual accrual and collective risk-sharing, the loss of purchasing power would be less than under current DB arrangements with ‘degressive’ accrual.In a bad-weather scenario, however, it would be worse, it conceded.The SER said its analysis had shown that the negative effect of abolishing an average contribution for various demographics could be offset by simultaneously introducing a new pensions system aimed at building up financial reserves more slowly.The advisory body, however, had no answer as to how to deal with funding shortfalls arising during the transition from the predominantly DB system to new arrangements.It said more research was needed on how best to protect pensioners without burdening active participants and future generations.Previously, Kees Goudswaard, chairman of the SER committee, offered as possible solutions the smoothing out of any discounts and waiting until pension funds’ coverage ratios stood at 100%.Klaas Knot, meanwhile, president of supervisor DNB, pointed to the urgency of implementing a new pensions system, “as shortfalls at pension funds could increase further”.He recently urged pension funds to begin mapping out their participants’ risk preferences, assessing which pensions contracts would match this and deciding how to carry out any transition to a new system.Knot advised against simply waiting for interest rates to be raised again.“The current system has structural flaws that won’t be corrected by hoping for a rate increase,” he said.In other news, Jetta Klijnsma, state secretary for Social Affairs, said struggling pension funds would be prohibited from delaying necessary rights discount until a new pensions contract had been established.In a letter to Parliament, she argued that the new pensions arrangements were still unclear.“Moreover, funding ratios could deteriorate further and hamper a transition to a new system,” she added.A recent DNB survey concluded that, if pension funds’ financial position failed to improve by the end of this year, 27 schemes with 1.8m participants would have to implement a rights discount of 0.5 percentage points on average.
UK pension funds lag their peers in the rest of Europe when it comes to having responsible investment policies referencing labour rights, according to a study by the International Transport Workers’ Federation (ITF).The study was motivated in part by the union’s concern that although progress had been made with respect to incorporation of environmental, social, and governance (ESG) factors by institutional investors, social issues are often overlooked.It reviewed the responsible investment policies of the 100 largest European pension funds and providers.Almost two-thirds (63%) of the sample – including funds in the Netherlands, Sweden, and Denmark – referred to international standards including labour rights such as the International Labour Organization’s core conventions and the UN Global Compact. The UK was “the clear outsider”, it found, as it accounted for two-thirds of the funds that did not refer to international standards, and 78% by assets (€684bn).This finding was significant, the ITF said, because the UK had the largest pool of retirement assets in Europe, and, in contrast to many other European countries, did not provide board-level representation for workers.“So neither does the governance structure for its public companies provide a formal role for workers, nor do the vehicles of UK workers’ retirement savings formally promote their interests,” it said.More generally, it said the study’s findings were important because they showed that it was “entirely possible for funds to adopt policies that promote workers’ rights, and that existing fund policies may be shaped more by the country’s political and social culture than fiduciary duty or regulation covering pensions and investments”.Tom Powdrill, responsible investment coordinator at the ITF and author of the report, told IPE that the geographic split seemed to run counter to the increasingly accepted argument that ESG issues were financially material over the long-term.“If that is the case, then it seems pretty intuitively plausible that the way you treat people is going to be a factor in the financial performance of investee companies,” he said. “Therefore you shouldn’t really see any geographic split between which investors think labour issues matter and which don’t.“If that’s a historical cultural hang-up then we should try and change it.”The ITF said it was working with others in the labour movement to develop ideas about a model pension fund policy on labour issues. It also said that unions could help improve practice on labour issues at pension funds by sharing more information about companies with funds.Danish labour market pension fund PensionDanmark recently had meetings with representatives of two of the biggest UK trade unions over claims of wage-undercutting at two bio-mass plants in which the pension fund invests.ITF president Paddy Crumlin spoke of ethics and morals: “[Pension money] is the hard-earned product of hard work and industrial negotiation, and is a deferment of wages that workers decide to make to secure a dignified and decent retirement. It has to be put to work itself in a way that respects that source.“It is only right that it helps build sustainable individual and collective futures, and that it does so ethically. It is morally inconceivable that it should be invested in companies that attack the rights of the very workers paying towards these pensions.”
“We expect others to react and either build their own capabilities in this space or look for opportunities to similarly bolt on capability,” he added.“The deal is another key step in impact investing entering the mainstream and gaining traction based on investor demand. While exclusionary and inclusionary SRI and ESG integration are becoming more of a baseline standard for firms, strong impact investing propositions will likely become the battleground for differentiation in the responsible investing space.”Founded in 2001 as a UN initiative, BlueOrchard is the world’s first commercial manager of microfinance debt investments, according to a press release.It has around $3.5bn (€3.1bn) in assets under management across credit, private equity and infrastructure, and partners with leading global development finance institutions for blended finance mandates. It only invests in frontier and emerging markets. Major Dutch pension funds ABP and PGGM previously had investments in funds managed by BlueOrchard, but they had to pull out due to regulatory changes in the Netherlands.Schroders said the deal would support the expansion of its “sustainability capabilities” and accelerate its growth in private debt and private equity investments in emerging markets.Peter Harrison, group chief executive of Schroders, said: “Schroders has a strong belief in the value that investment can create in society, particularly within emerging and frontier markets. BlueOrchard’s expertise in this area is exceptional.“They share our values, recognising that through our combined contributions, we can purposefully affect positive change. They are a blueprint for the future of our industry and we are delighted to partner together.”Patrick Scheurle, CEO of BlueOrchard, said Schroders’ “stable ownership structure and heritage… makes them an excellent partner”.Schroders said there would be no changes to the management team, processes or strategies that BlueOrchard manages.Schroders’ Harrison, global head of private assets Georg Wunderlin, and Stephen Mills, executive chairman of Schroder Adveq, will be appointed to the BlueOrchard board of directors, according to the press release.The acquisition is expected to complete by the end of the year “subject to usual closing conditions”. Listed UK asset manager Schroders is to acquire a majority stake in impact investor BlueOrchard, underscoring the growing mainstream investor interest in this extension of the ESG investing movement.The announcement of the deal comes as return-seeking investors increasingly show interest in investments that have a positive impact on society and/or the environment.It is thought to be the first time a large European asset manager has made such a strategic move into impact investing. In the US, Goldman Sachs Asset Management acquired impact investor Imprint Capital in 2015. Its co-founder, John Goldstein, was yesterday announced as the head of a new sustainable finance group the banking group is forming.Mark Thomas, ESG specialist at asset management consultancy Alpha FMC, said Schroders’ move “really shows the focus and intent from bigger asset managers to enter into impact investing”.
Each of these assets will be selected to provide sustainable, long-term and risk-adjusted value to the pension scheme members, while creating a ‘double bottom line’ by making a positive contribution to social and environmental issues in the area, they said.A spokesperson for The London Fund said that through the collaborative efforts of the three institutions, the fund is expected to benefit from increased scale.“This allows us broader access to resources and a much wider investment pipeline than would be available to any of the individual organisations acting alone,” the spokesperson added.The fund, which will have a closed-ended structure, will be managed in partnership between LPP Investments (LPPI) and LCIV.By pooling their resources, LPPI and LCIV expect to have access to a greater range of investment opportunities for The London Fund than would be available to either entity acting alone. Three London-based pensions groups – Local Pensions Partnership (LPP), London Collective Investment Vehicle (LCIV) and London Pensions Fund Authority (LPFA), which have combined assets under management of close to £57bn (€67.7bn) – have joined forces to create a London-focused investment fund, The London Fund.The fund aims to invest in the UK capital, focusing on developing housing and infrastructure, both of which will improve the quality of life for London communities.The three entities are expecting to jointly target an allocation of several hundred million pounds to this new investment strategy, which is planned to launch later in the year.The trio announced that the fund’s portfolio will focus on investments in the City of London, the 32 London boroughs and their immediate surrounds, in assets such as residential property – specifically build-to-rent – and affordable housing, community regeneration projects and infrastructure, including digital infrastructure and clean energy.
Great for entertaining.“We were just super keen to get our teeth stuck into something else and keep challenging ourselves,” she said.Ray White Prestige Gold Coast agents Jackson Paradise and Carita Lanham will take the house to auction on September 30 at 11am. That spectacular view in the background.“I always knew I wanted the house to (have) a bit of a Palm Springs-inspired thing about it (but) we designed it based around our family and what we wanted to live in.”A garden at the centre of the house with a palm tree that rises as high as the third floor is a standout feature. Master bedroom.The result is an award-winning home with panoramic views of the coast and city skyline.“I think we’ve pretty much got the best view in the street,” owner Dominee Gessner said.“We can see from Main Beach to the far edge of Burleigh.” The bathroom. One of the kid’s bedrooms.“It’s so good for entertaining,” Ms Gessner said.They have decided to sell the house so they can build a new one on a block they have bought across the road. The backyard. The 6m palm tree.Ms Gessner said a crane had to lift the 6m palm into place. While it was hard to pinpoint a favourite feature, she loved the seamless flow of indoor and outdoor living spaces most. Kids room.Ms Gessner and her husband Ben Rochford, who have lived in the six-bedroom house with their two children for the past year, will take it to auction later this month.The couple designed and built the house, which recently won a 2018 Master Builders House and Construction award, about two years ago with the help of an architect. Just relax.More from news02:37International architect Desmond Brooks selling luxury beach villa15 hours ago02:37Gold Coast property: Sovereign Islands mega mansion hits market with $16m price tag2 days agoThey have years of experience renovating houses but building was a new challenge.“We’ve done about six renovations so this was our first full-build for ourselves,” Ms Gessner said. 18 Abbey Ridge Rd, Reedy Creek. Living room. 18 Abbey Ridge Rd, Reedy Creek.IT was once advertised as a hillside block with limited views but the three-storey house that towers above it today has some of the best views on the Gold Coast.The Reedy Creek property, dubbed The Hill House, was built into the side of its sloping land on Abbey Ridge Rd to make the most of the extra height. Bedrooms galore. Open spaces. The house has won awards.
First-home buyers snap up final apartments at the $650 million South City Square precinct. Photo: SuppliedFirst homebuyers are snapping up the last remaining apartments at South City Square’s The Mews apartments in Woolloongabba.As the third and latest stage of the $650 million South City Square precinct nears completion, The Mews’ 139 one and two-bedroom apartments, set to open in mid-June, are the final chance to buy in the luxury inner-city precinct for the next few years.More from newsParks and wildlife the new lust-haves post coronavirus13 hours agoNoosa’s best beachfront penthouse is about to hit the market13 hours agoPellicano and Perri Projects are the developers behind the award-winning precinct. Pellicano development operations manager Michael Kent said The Mews was designed for first-home buyers seeking architecturally designed, convenient urban living at an attainable price point – from $399,000 to $599,000.“We’re proud to release the final apartments for first-home buyers and owner occupiers – coinciding with the completion of the precinct,” Mr Kent said.“Only a final few of the Mediterranean-inspired luxury apartments are left for buyers until the next stage of the development. It’s a testament to the award-winning design, our state-of-the-art facilities, premium retailers, and the vibrant community that’s coming alive at South City Square.“Much like the New Deshon and One South City, 90 per cent of The Mews sold out within just a month of being released.’’When completed, the South City Square precinct will be home to 850 apartments, a luxury hotel, cinemas, supermarket, health and wellness facilities, offices, a childcare centre, as well as dining, cafes and boutique retailers.The precinct was named Best Residential Property and Best Mixed-Use Project at the 2019 International Property Awards.
MORE: Star builders’ new home for sale Camille Zhang, 23, is looking to buy a property at Ascot Silver which is in a trendy and affluent area close to the CBD, shops and airport. AAP Image/Richard GoslingCONFIDENCE has returned to Brisbane’s property market with a spike in apartment inquiries from investors and first homebuyers in the wake of the federal election.After months of uncertainty, developer Abacus Property Group said the level of inquiry for the last remaining apartments at its Ivy and Eve project at South Brisbane had more than doubled in the past week.Abacus development manager Bryant Greenberg said: “There are some very positive signs emerging that southeast Queensland buyers are back in the hunt for new apartments.Some developers are not taking any chances through with Ascot Silver, a new development in one of Brisbane’s blue-chip suburbs, giving away a car to the first person who buys a townhome. The new car is worth $20,000. Brisbane kitchen scoops top award Worst suburban credit scores revealed Prospective buyer Camille Zhang, 23, was among those intrigued by the property and prospect.Ms Zhang said she was looking to buy a property in a trendy and affluent area close to the CBD, shops and airport.“I love the idea of having a four-bedroom townhome which I can share with flatmates.” Camille Zhang is a prospective buyer of new this new Ascot townhouse, Ascot Silver. AAP Image/Richard GoslingCoreLogic senior research analyst Cameron Kusher said he was not surprised interest in apartments had piqued.“I think it really highlights that people were sitting on the sidelines waiting for the outcome of the election,” he said“There was clearly some concern about those policies (proposed changes to negative gearing and capital gains tax) and now that they’ve passed, people are more inclined to go and purchase properties, or at least have an interest in purchasing a property.” Mr Kusher said there was still plenty of apartment stock on the market in Brisbane and developers were still offering good buyer incentives. “There’s probably a sense now from people who are thinking … I can maybe go out and start looking for some good deals in the market,” he said. 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This modal can be closed by pressing the Escape key or activating the close button.PlayMuteCurrent Time 0:00/Duration 0:00Loaded: 0%Stream Type LIVESeek to live, currently playing liveLIVERemaining Time -0:00 Playback Rate1xFullscreenHow much do I need to retire?00:58 One-bedroom apartments are for sale at Ivy and Eve.Mr Greenberg said “together with expectations of a drop in interest rates and growing awareness that the stock of available apartments is facing a sharp decline, it seems people are suddenly much more confident.”He said Ivy and Eve had booked 18 new inspections in the first week after the election and expected the remaining apartments to be sold very quickly.“The likelihood of improved conditions will also start to put upward pressure on prices so now is a great time for buyers to take advantage of prices set during the slowdown in activity leading up to the election,” he said.More from newsParks and wildlife the new lust-haves post coronavirus12 hours agoNoosa’s best beachfront penthouse is about to hit the market12 hours agoThe one-bedroom luxury apartments remaining at Ivy and Eve, a 476-unit complex, are priced from $399,000.Azara Projects development manager Amy Tang said: “With the election being over, we’ve had an increased number of queries for our luxury townhomes (at Ascot Silver) in Brisbane and more visitors to our inspections as well”. Place Advisory director Lachlan Walker said the increase in activity was due to stability in the market.“There was a lot of uncertainty around the proposed changes in the real estate industry and people didn’t want to make decisions that impacted their lives,” Mr Walker said. “People who were sitting on the fence are now looking at committing to buy.“If you have higher than average stock on offer, I think that’s what people want — it’s nice to see some activity.” FOLLOW US ON FACEBOOK