For Fiona Rowley, property investing has turned out to be an ideal combination of the theoretical and the real world. The £4.7bn M&G Property Portfolio she manages is one of the most popular and well-known UK bricks and mortar funds around.
“What drew me into property was initially my mathematical background, which goes back to my school days,” Rowley says. “I had first thought about accountancy and by luck I came across surveying as a career option and became a chartered surveyor. I fancied doing something that needed numerical acumen but was also ‘touchy-feely’, which is what drew me to bricks and mortar.
“I started as a surveyor with Knight Frank and worked through all the necessary steps to become chartered. Then, having not had a gap year, I decided to travel the world between 1993 and 1994, spending a lot of time in South and Central America. When I came back, I joined M&G and I have now been with the company for 25 years,” Rowley says.
“I started as an investment manager, so the job was direct buying and selling. I had that role until 2004. When the fund I now run was launched, I became a fund manager. It is very different to investment management because it is more strategic than just the day-to-day buying and selling of assets.”
While fund management can often be more about numbers on screen rather than anything you can touch, property has a closer link to the real world and people’s everyday lives, which is central to the appeal it has for Rowley.
“What I really like about property investing is that I am dealing with tangible assets. When I buy something, I can really see how I can add value. I do not dislike equities but with them you are effectively buying the management. You can look at all the figures but essentially it is in somebody else’s hands.
“I like all the different parts of investing in property, from understanding the cashflow, to the push-and-pull factors affecting each asset,” she continues.
“There are a variety of things each day, such as dealing with tenants and with refurbishments, where I can really add value in direct, tangible ways.”
Last mile delivery
Rowley is clear about where she stands on the issue of income versus capital growth with property investing.
“We are a total return fund, with the objective of trying to maximise returns through a combination of income and capital growth, primarily achieved through direct investment in commercial property.
“I have an income bias. When you look at data on the makeup of returns from property it shows that 70% to 75% come from the income element, so my approach is always to buy assets that will deliver that long-term income.
“With the right property, you will get long-term income growth, which is what gives you the capital growth as well,” she says.