Team Build-Out - Real Assets

The Challenge

01

Our client was considering whether to renew their existing third-party manager mandate, or to internalise their £2bn Real Asset Property portfolio.

02

There was a need for strict confidentiality as our client did not wish their intentions to be revealed to the third party manager or the market.

03

The CIO had to present a business case to the Management Committee setting out the benefits of such a move, as well as the resourcing required to create a robust capability, and the estimated financial outlay this would involve. It was vital that all potential risks had been assessed before going ahead with the project. Godliman was able to supply comprehensive data supporting the business case for a team build out, leading to a green light for internalising the mandate.

04

A team lift-out was ruled out as the client did not wish to disrupt their culture by having a team within a team. Hence the preference was to hire multiple individuals to create a team that both worked well together and fitted into the collaborative culture of the organisation.

The Solution

Competitor Analysis & Best-Fit Search

The Godliman team had not worked in this area before. However, we conducted a research project analysing ten Real Asset Property portfolios that were similar in AUM and investment objectives to our client’s. 50% of these firms outsourced to third-party managers and 50% managed the assets in-house. We looked at factors including relative strengths and weaknesses of both structures and an evaluation of ‘best practice’ in terms of size and structure of in-house teams and an estimate of overall costs.

The client used this research project to facilitate and support the discussion to internalise the Real Asset Portfolio, which the board then agreed upon. Godliman worked with the client to develop a hiring plan to determine the required profiles and sequencing of hires and the message that was to be conveyed to the market.

We initiated our Best-Fit Research process, producing a map of all UK Real Asset specialist investment houses, focusing specifically on Real Estate; identifying possible team heads, while simultaneously identifying possible candidates for the three additional team members for other roles once the team head had been hired, all the time focusing on Best-Fit for the firm.

We identified 907 people within the Real Assets Property sector and we spoke to 33 candidates who were suitable for the ‘Head of Team’ role before narrowing it down to 14 to meet with us. We conducted in-depth skill-based interviews and personality profiling. We put forward six candidates to meet with the client who not only had the qualifications, experience, and technical skills required, but also had a strong fit with our client’s culture of collaboration and cooperation.

Testimonial from client

Godliman has helped us build out new areas of our business, providing in-depth market knowledge to assist our thinking and approach to internalising investment strategies. These have sometimes been new areas for them as well as for us but I have trusted their search process to uncover excellent candidates who fit our asset-owning culture and are capable of delivering in the role. I have worked with Rupert for over 20 years and have always felt confident that Godliman’s extensive experience, thorough process, and sound judgment will deliver what we need. Testament to this is that all their placements are excellent additions to our team and are thriving

CIO, Top 10 UK Pension Fund

The Results

4x Hires

Godliman placed four successful hires into the team: Head of Property and three Portfolio Managers.

<3 yrs

Our research had indicated that, in order to cover team overheads, they would need to bring 50% of the portfolio in-house within two years; whereas the team managed to internalise the entire portfolio within three years.

£2bn

The full team has remained at the firm for 3.5 years to date, successfully internalising and restructuring the £2bn Property portfolio. A further two individuals were placed by Godliman to focus on Infrastructure a year ago.

Promoted

The team Head was promoted to overall Head of Real Assets, expanding their responsibility to Infrastructure Debt, Infrastructure Equity and Real Estate Debt offerings.

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Team Build-Out – Real Assets