HESTA backs Heitman in Euro property expansion

The partnership between HESTA and the global real estate investment firm has expanded, with the fund investing in European alternative property sectors.

Heitman LLC (Heitman) has received an allocation from HESTA to invest in European alternative property sectors such as self-storage, student housing, residential housing, and healthcare.

Reportedly, this new investment has established Heitman as one of HESTA’s largest international property investment managers.

Head of portfolio management at HESTA, Jeff Brunton, said the allocation with Heitman will support the fund in continuing to “build a well-diversified portfolio of property investments designed to help deliver strong long-term returns for our more than one million members”.

Managing director, European real estate investment at Heitman, Caleb Mercer, explained the appeal of alternative sectors: “Unlike the traditional property types, the alternative sectors are driven by needs-based demand and are undersupplied, making them less tied to economic cycles.

“We believe this makes them an attractive way to benefit from the price reductions available in Europe while mitigating exposure to uncertain economic conditions.”

HESTA has already invested with Heitman through its US core investment strategy since 2017.

This new allocation further strengthens Heitman’s presence in the Australian market, where it currently manages $8.4 billion across real estate equity and debt strategies.

“Heitman has been investing in US core real estate on behalf of HESTA since 2017,” said Beau Titchkosky, managing director, client service and marketing for Heitman in the Asia-Pacific region.

“We are delighted to expand our relationship with HESTA and deepen our commitment to the Australian market by providing bespoke solutions to our clients.”