Legal & General and Schroders Shift Focus to Resilient US Real Estate Assets

London, UK - 23 Sept 2024: British financial giants Legal & General and Schroders are making strategic moves in the US real estate market. Instead of traditional office spaces, they’re directing significant capital toward more resilient and high-demand assets: rental homes and data centers.

Legal & General’s Approach:

• Legal & General plans to strengthen both its real estate equity and debt businesses in the US.
• A dedicated team of 20 professionals in Chicago will focus on rental homes—a segment showing robust demand.
• The move reflects confidence in the resilience of the US real estate market.

Schroders’ Expansion:

• Schroders, too, is eyeing growth opportunities beyond traditional office spaces.
• The company recently expanded into a Pan-American data center portfolio.
• This move comes as banks retreat due to stricter capital regulations.
• Schroders sees a financing gap in real estate debt as a lucrative opportunity.

The post-pandemic landscape has reshaped property investment priorities. With many companies embracing long-term remote work, the demand for traditional office spaces has waned, leading investors to seek alternative real estate opportunities. The focus on rental homes and data centers by Legal & General and Schroders reflects a strategic shift towards more stable and future-proof assets. As the US Federal Reserve eases interest rates, the resulting lower borrowing costs could unlock substantial investment potential, fueling growth in areas traditionally overlooked.

Legal & General and Schroders are navigating obstacles as opportunities, positioning themselves for growth in overlooked areas. The US real estate market remains dynamic, and these strategic moves reflect adaptation to new demand realities.