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Call it Nuveen now: TIAA renames its asset management unit

Call it Nuveen now: TIAA renames its asset management unit | Timberland Investment | Scoop.it
TIAA is one of the oldest names in the retirement industry, founded by industrialist Andrew Carnegie in 1918. But it is stepping away from that history in one part of its business as it seeks more money from outside investors.

TIAA’s asset-management unit Monday renamed itself Nuveen, taking the brand of a company TIAA purchased in 2014. The division’s dozen money managers oversee almost $900 billion in assets, ranging from stock mutual funds to timber and real estate.

TIAA in December hired Vijay Advani, former co-president at Franklin Templeton Investments, to be president and operating chief of the reorganized business. It also appointed TIAA veteran Jose Minaya to help oversee the 12 money managers as president of global investments.
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Real Assets: The bigger picture

Real Assets: The bigger picture | Timberland Investment | Scoop.it

Get real. Real assets, that is. This is the mantra of institutional investors searching the globe for sources of long-term income. Investors want protection from market volatility and future inflation embedded in the economy through global quantitative easing programmes.

 

It is a tall order and real assets fit the bill. Institutional investors have given the asset class a big thumbs-up in the five years up to 2014, so much so that allocations to listed real assets have soared by 325% during that time, according to eVestment Alliance. That rapid pace includes a near-doubling of investment in commodities, a quadrupling of investment in US REITs, and surging growth in global listed infrastructure, master limited partnerships and multi-strategy real asset funds.

 

Real assets could boost long-term risk-adjusted returns. An analysis of the effect of a 20% real assets allocation on a 60/40 portfolio by Center Square Investment Management showed that over a 20-year period from 1995 to 2015 the portfolio with 10% in private real estate, 5% in listed real estate and 5% in listed infrastructure posted a return of 6.95% and risk of 7.01%, compared to 5.56% and 9.40%, respectively, for the 60/40 portfolio.

 

Major investment managers are moving fast to adapt their business models to stay ahead of client demand for expertise in all these sectors. This year kicked off with a series of announcements by leading investment managers forming real assets groups by combining their property, infrastructure, natural resources and commodities capabilities under one umbrella.
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The crux of the transformation is the application of a risk-bucket approach to asset allocation, says Jodie Gunzberg, global head of commodities and real assets at S&P Dow Jones Indices.
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The shift into real assets is spawning innovations in asset allocation, new thinking in index construction, and expansion of executive roles to lead new real assets groups. Then there is the technology required to implement new approaches with the transparency and customisation clients require today.

 

The creation of a new index (see Defining the universe) to track the sector holistically provides a benchmark for the new broader view of real assets, and may well lead to the next generation of real assets investing – by defining the universe, the index will establish a beta for real assets, a necessary precondition for managers to devise smart beta and enhanced indexing strategies.

 

Early this year, TIAA Global Asset Management, BlackRock and Morgan Stanley created new business units to focus on real assets investing. While the combinations of expertise varied, the goal was the same: to meet increasing client demand by better leveraging their respective capabilities. TIAA, for instance, counts property, agriculture, timber, infrastructure and energy, as well as subsidiaries investing in those sectors, as its real assets capability.

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TIAA partners give super funds timber and agricultural insight

TIAA partners give super funds timber and agricultural insight | Timberland Investment | Scoop.it

The $US866 billion ($1.2 trillion) financial services giant TIAA expects there will be at least $US100 billion invested in timberland operations and agriculture across the world in the next 10 to 20 years and has come to Australia to tell Australian super funds how to participate.

 

TIAA global asset management head of agribusiness John Goodreds said it was natural for TIAA to look at long-term investment horizons and that timber and agricultural land and management were "conducive" to such long-term horizons. "These areas are also driven by real fundamentals – they are goods the world needs, not just the latest trends," Mr Goodreds said. He also said they offered exposure to beta and alpha – terms used to describe the consistency of an asset's returns in response to swings in the market. "They also offer inflation protection which a lot of institutional investors are very thoughtful about today."

 

TIAA's two partners in agribusiness and timber, AGR Partners and Greenwood Resources, are also in Australia helping explain the importance of the emerging asset class. Greenwood Resources president and chief executive Jeff Nuss said he had been working hard to identify ways of bringing such an investment to institutional investors. The TIAA-backed Global Timber Resources Fund which Greenwood Resources runs, has raised its required capital of $US670 million. "We anticipate there is probably another $US100 billion in investment capital needed to come into the space and meet the future demand for wood."

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Farmland assets grow 33%; timber assets also climb

Farmland assets grow 33%; timber assets also climb | Timberland Investment | Scoop.it

Farmland and timber asset classes each had healthy growth during the survey period. Farmland manager assets were up 33% to $1.24 billion, albeit from a small base. Timber assets were up 11% to $19.4 billion.


TIAA-CREF's farmland assets grew by 56% to $7.8 billion in committed assets, which includes farmland and agribusiness. Part of the increase was due to new capital, a $3 billion farmland fund which held its final close in July after raising most of its capital by June 30, said Justin “Biff” Ourso, senior director and portfolio manager with TIAA-CREF and a member of the natural resources and infrastructure investments team who is based in Charlotte, N.C.
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Timber managers continued a global push, seeking to invest outside the U.S. which traditionally had been the site of much of timber investment. “Agriculture is an asset class that is early in its infancy,” he said. During the survey period TIAA-CREF raised a $667 million timber fund this year with a number of institutional investors that is focusing a global strategy, Mr. Ourso noted.


“Agriculture and timber have interesting thematics, including increasing population, increasing middle class and evolving dietary patterns” that is attracting investor interest, he said.

TIAA-CREF's timber assets grew 13% to $2.3 billion during the survey period, placing it in the fourth spot on Pensions & Investments' list of timber managers. Global Forest Partners LP, Lebanon, N.H., had $1.6 billion in timber assets for U.S. institutional, tax-exempt investors, an increase of 8%.


“Our investments are almost exclusively outside the U.S., said Peter C. Mertz, chairman and chief executive officer of Global Forest Partners LP, Lebanon, N.H., in an e-mail. The firm ranked sixth on the list of top timber managers.

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TIAA-CREF and GreenWood Resources Announce $667 Million Global Timber Company

TIAA-CREF and GreenWood Resources Announce $667 Million Global Timber Company | Timberland Investment | Scoop.it

TIAA-CREF, a leading financial services provider, and GreenWood Resources (GWR), a global timber management company and subsidiary of TIAA-CREF, today announced the close of Global Timber Resources LLC (GTRCo), a $667 million global timber company.

GTRCo is a new company designed to invest in timberland assets across multiple geographies, including North America, Latin America, Europe, and Asia. It is principally focused on the development and management of sustainable plantation forestry assets to supply growing worldwide demand for wood and forestry products. The company has capital commitments from several investors including the TIAA General Account and international institutions such as Caisse de dépôt et placement du Québec (Caisse), AP2 and the Greater Manchester Pension Fund, among others.

The new company adds to TIAA-CREF’s expanding global asset management platform that includes TIAA-CREF Asset Management which provides investment management services covering a wide range of domestic and international strategies, including equities, fixed income, real estate and real assets to individual and institutional investors through its subsidiaries.

“We believe the macroeconomic fundamentals for timber investment are strong and see great potential for direct investment in emerging economies where we can benefit from low cost production and better proximity to growing demand,” said Jose Minaya, senior managing director and Head of Private Markets Asset Management, TIAA-CREF Asset Management. “We are excited about the relationship forged with our timberland investors and look forward to a high level of collaboration as we seek to achieve our investment goals.”

GreenWood Resources will manage the new company’s portfolio of timber assets. TIAA-CREF acquired majority ownership of GWR in 2012. GWR develops and manages sustainable tree farms in targeted regions and has a vertically integrated management group with professionals in investment and financial management, improved plant material strategies, and day-to-day forestry operations. The company, a holding of TIAA-CREF Asset Management, manages approximately $950 million in assets for institutional investors, which includes the $667 million of capital committed to GTRCo.

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Alternative Investment Strategies for 2014: TIAA Favors Timber

Alternative Investment Strategies for 2014: TIAA Favors Timber | Timberland Investment | Scoop.it

TIAA-CREF Global Investment Strategist Dan Morris discusses his alternative assets strategies for the new year with Deirdre Bolton on Bloomberg Television’s “Money Moves.” 

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TIAA-CREF buys majority stake in timberland manager GreenWood Resources

TIAA-CREF buys majority stake in timberland manager GreenWood Resources | Timberland Investment | Scoop.it

TIAA-CREF has acquired a majority stake in GreenWood Resources, a timberland investment manager with $350 million under management.

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Nuveen Investments expands access to alternatives for financial advisers' wealthy clients

Nuveen Investments expands access to alternatives for financial advisers' wealthy clients | Timberland Investment | Scoop.it

Nuveen Investments has rolled out a new platform that will expand access of its alternative investment lineup to wealthy individuals working with financial advisers.

 

Nuveen, an operating division of TIAA Global Asset Management, already manages $140 billion worth of alternative investments for institutional investors in products including real estate, agriculture, timber, agribusiness, and private equity.

 

But the addition of a technology-driven platform is designed to expand that access to qualified clients of financial advisers and family offices.
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The Nuveen platform, which provides advisers access to alternative products at TIAA Global, deals with the kinds of private investment products and partnerships that require investors meet certain net-worth minimums.

 

But, as Mr. Perry explained, technology is making it easier for advisers to gain access to a variety of unregistered products. Nuveen has engaged technology provider Artivest to create a white-label platform to provide access to private alternative investments from Nuveen/TIAA. The products had previously not been available to individual investors.

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Nuveen Hires Bill Stout to Drive Alternative Investments Growth

Nuveen Hires Bill Stout to Drive Alternative Investments Growth | Timberland Investment | Scoop.it

Nuveen Investments, an operating division of TIAA Global Asset Management, today announced the appointment of Bill Stout as Managing Director and Head of Alternative Investments Business Development.
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Nuveen draws heavily from TIAA Global Asset Management’s industry-leadingi TIAA Global Real Assets is ranked as the largest real estate manager of U.S. tax-exempt assets, the largest manager of real estate assets in farmland, and one of the top ten managers of real estate assets in timber according to Pensions & Investments, October 19, 2015.

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TIAA-CREF Reveals Reorganization

TIAA-CREF Reveals Reorganization | Timberland Investment | Scoop.it
TIAA-CREF plans to combine its real assets units into a single business line, the asset management giant announced Tuesday. 

The new standalone division will wrap in many of TIAA-CREF’s largest units, including global real estate, agriculture, timber, infrastructure, and energy. In addition, the real assets group is to take over subsidiaries TH Real Estate, Westchester Group Investment Management, GreenWood Resources, and Churchill Asset Management.

All told, TIAA-CREF expected the real assets business to comprise roughly 900 staff members in 16 countries. The New York-based firm managed $100 billion in real assets as of December 31, 2015. 

Private Markets head Joes Minaya is to take over the new division as president, the company said, and supported by current private markets CIO Heather Davis. 

TIAA-CREF scooped a COO for the unit from Nuveen Investments: John MacCarthy spent a decade there as chief legal officer. 
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Greater Manchester, AP2 invest in new timberland company

Greater Manchester, AP2 invest in new timberland company | Timberland Investment | Scoop.it
The Greater Manchester Pension Fund (GMPF) and Swedish buffer fund AP2 are among investors committing to Global Timber Resources LLC (GTR), a new company designed to invest in timberland assets across different regions, including North America, Latin America, Europe and Asia.

Both pension funds have each committed $50m (€45.2m).

GTR has been launched by TIAA-CREF, a US-based financial services provider specialising in the educational, medical and cultural sectors, and its subsidiary Greenwood Resources, a global timber management company.

It closed its fundraising with commitments of $667m, with other investors including Caisse de dépôt et placement du Québec (Caisse) and the TIAA General Account.
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After big TIAA-CREF-Nuveen deal, boom predicted in manager mergers

After big TIAA-CREF-Nuveen deal, boom predicted in manager mergers | Timberland Investment | Scoop.it

“I think you'll see a 'boomlet' in mergers-and-acquisition activity over the next 12 months,” said Ben F. Phillips, partner at Casey Quirk & Associates, a consultancy that advises on asset management deals. “The pricing gap between bidders and askers has narrowed.”
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“Today, where you're going to see more mergers-and-acquisition activity is in the alternatives field where the major players are seeking expertise in relatively unusual areas,” said Burton J. Greenwald, a fund consultant who works with Franklin Templeton (BEN) Investments (BEN). “That's a special product area that's growing rapidly and requires a very narrow expertise.”


Mr. Phillips agreed that firms with strengths in alternatives are in high demand. He also said asset managers are seeking investment expertise in credit, global investments and multiasset allocation.

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TIAA-CREF Deal for Timberland a Sign of the Times?

TIAA-CREF Deal for Timberland a Sign of the Times? | Timberland Investment | Scoop.it

Wildfires aside, timberland is heating up as a pension asset, pun intended...with major acquisitions of two Portland, Oregon–based timberland asset managers announced in less than a month. And now with a big pension fund manager getting in on the action, one can’t help but wonder if other pension funds will see upside here.

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Forests’ inflation, correlation appeal attracts pension funds

Forests’ inflation, correlation appeal attracts pension funds | Timberland Investment | Scoop.it

“The performance of our timberland assets has been a very stable part of our portfolio overall,” agreed Sandy LaBaugh, a senior director and portfolio manager at TIAA-CREF. The US pensions giant, which has $515 billion under management, has built up a $1.6 billion forestry portfolio since it began investing in the asset class in 1998. According to figures from David Brand, managing director of New Forests Asset Management, which runs $1.5 billion in forestry assets, US timberland assets were only around 22% correlated with the S&P500 between 1987 and 2010, and negatively correlated with gold and oil.

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