Man GPM Aalto. The real assets business of Man Global Private Markets.

About Man GPM Aalto

Man GPM Aalto ('Aalto') is a value-focused investment business with a fundamental approach to investing. In each market where we operate, we consistently seek out returns and manage risks by understanding what we invest in on a 'grassroots' level. Our investment universe is real assets and real businesses, and our goal is to understand them more thoroughly and more consistently than anyone else. For us, investing is as much about this discipline as it is about having a prescient initial thesis. We take pride in the nature of our investment process.

 

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Our Strategies

Our direct real estate activities focus on US Single Family Rentals ('SFR') which the Aalto team believes offers attractive risk/reward characteristics.

Our team has invested in several real estate sub-markets according to market opportunities available at the time. We typically take a long-term view on investing and focus on seeking value by actively managing the assets. Since 2012, Aalto has focused its direct real estate investment activities on the US single family rentals market which we believe offers compelling risk/reward characteristics and a diversified cash flow profile following the prolonged US housing market correction which lasted from 2006 to 2012.

Aalto has a clearly defined and focused investment process in the US residential market based around 14 metropolitan areas where we have acquired, refurbished and currently own over 3200 individual properties. We believe the US single family residential market continues to offer value and is appealing to investors seeking the potential of inflation protected cash flow generated by a large and transparent asset class.

The direct real estate team consists of nine professionals who work closely with our local operating partners throughout the US. The team is run by Petteri Barman who acts as the portfolio manager alongside our US based Housing team in our Charlotte NC office as well as our Operations and Finance teams.

The Aalto team has longstanding experience in the European and US real estate debt markets across both public and private markets.

Since late 2014, we have become more selective in our credit selection given the increasing competition in the European real estate debt markets and as a result we have focused on specific, overlooked niches in the market. Therefore, after considerable market research, Aalto began providing residential development loans into a niche market within the EU where it was identified that due to a combination of housing shortage, lack of financing from both traditional and alternative financiers and pent up demand the fundamentals were in place for what we felt could be a conservative development loan strategy. The development loan strategies target smaller borrowers with strong track records.

In 2015, Aalto opened an office in the US to more efficiently run its US housing strategy. As a part of the expansion, Aalto hired a team from Wells Fargo with a history of US real estate lending experience (both pre- and post-crisis). In the US market, Aalto currently focuses on direct lending strategies that are complementary to its direct residential real estate investment business. These strategies include lending to residential real estate developers and long-term investors.

The real estate debt strategy is run by Mikko Syrjänen with Matthew Pritchard (Portfolio Manager for Europe) and Travis Masters (Portfolio Manager for the United States). Acknowledging the importance of direct loan sourcing Aalto has built dedicated origination both in Europe and the US where Stephen Eighteen and Derrick Land head up the origination activities.

Aalto considers 'point in time' investments on a case by case basis across asset classes, geographies and investment strategies. We constantly look for investment opportunities which we believe offer attractive risk-reward characteristics.

Aalto is opportunistic when considering new investment strategies and from time to time execute 'point in time' strategies on behalf of a close group of institutional investors including pension funds, insurance companies and family offices. Many of these opportunities are in dislocated 'real assets' or businesses where we invest via owning the asset outright or via owning debt secured by the asset.

We seek to build long-lasting trusted investment relationships with a limited number of key clients. Our current investor base is divided between pension funds, insurance companies and private family offices. We believe that our firm is an ideal partner to those investors who have chosen to make direct investments and co-investments in value oriented strategies.

Our in-house expertise is tailored to complement our clients' own resources in asset sourcing, due diligence, deal execution and ongoing asset management. We expect our investors to be inquisitive and active in their management style and in their relationship with Aalto. Investors are serviced by the Investor Solutions team staffed with dedicated pensions and insurance specialists who take a pro-active approach in seeking to meet and exceed their requirements.

 

Investment Philosophy

The principles of our investment process:

Fundamentals driven investment approach

Aalto invests bottom-up and seeks to understand each of our investments on a fundamental level independent of asset class.

Intellectually honest

The cornerstone of our investment approach is accurately understanding the reality or the truth. Therefore, we only invest if we believe we can understand 'what is really going on' and in the absence of compelling opportunities that meet this criteria, we are comfortable holding cash until such opportunities become available.

Value of collective wisdom

We believe in bringing together knowledge from different industries, asset classes and different parts of the capital structure and then challenging and sharing this wisdom openly across our investment teams and clients to guide our day-to-day investment processes.

Responsibility

We feel a deep sense of responsibility towards our investors who have entrusted us with their capital.

Full transparency – real time

Our clients require transparency and look through to the portfolio. Many of our clients also want to be actively involved throughout the investment process. In response, we have made transparency a strategic priority for the firm.

Enabled by web-based portfolio management tools we increase transparency by providing clients with live access to the same information and analytics that our portfolio managers use when managing the assets on a day-to-day basis. For example, clients in our direct real estate strategy are able to view the status reports and KPI analytics of individual properties on a real time basis through a web portal.

Responsible Investing

 

At Aalto we believe that understanding and managing environmental, social and governance ('ESG') issues across our investments is an essential part of our long-term, fundamental investment approach. As such, responsible investing is integrated across our investment teams and strategies and a part of our day-to-day investment evaluation process. To ensure that our ESG initiatives change as the investing landscape changes and that such initiatives and policies are effective and implemented, we have created a central ESG oversight function.

In our investment strategies, we target and implement a range of bespoke ESG initiatives. In our real estate businesses (both direct and debt) where possible we aim to improve or encourage our construction partners to raise the energy efficiency of the homes/commercial space, reduce waste, improve health and safety practices and consider a more ethical supply chain management. In our listed equity investments we engage in a close dialogue with management to also ensure that the companies we invest in for the long run also share these values and practices.

In developing and implementing our ESG policies to each of our strategies, we have given consideration to various ESG codes and standards. Central to our investment philosophy that is based on understanding each investment on a deep fundamental level, we have tailored the ESG approach for each strategy. However, to ensure at the firm level that all aspects of ESG matters are covered, we have become a signatory to the United Nations-supported Principles for Responsible Investment ('PRI') (www.unpri.org)

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