Message from the CEO
The year 2020 obviously also turned out differently than expected for Bouwinvest. However, our diversified portfolio gave us a strong basis, while our long-term vision put us on a solid footing and our resilient organisation helped ensure that we emerged from a turbulent year in good shape.
In response to the first lockdown in March, we immediately developed a strategy that would enable us to weather the crisis. While we supported our employees by offering them the facilities they needed to work from home and to maintain their motivation, we also made sure our investors were kept up to date with frequent communications on the development of their investments. In addition to this, we devoted a great deal of attention to our operating partners outside the Netherlands and our tenants in the Netherlands, a number of whom were badly affected by the Covid-19-related measures. Together with them, we looked for appropriate solutions.
The pandemic and the lockdowns initially led to a great deal of unrest on national and international financial markets. Experts were predicting that real estate values could decline by as much as 30%. Bouwinvest provided its clients with regular updates in the form of forecasts with various scenarios, all based on fundamental market analyses. These forecasts were less negative than the general market prognoses and actually improved during the course of the year.
In the end, Bouwinvest managed to close the year in good shape. Our invested capital increased to € 13.4 billion and we generated a total return of 3.4% on the portfolio as a whole. This was obviously less than budgeted, but quite satisfying under the circumstances. We did not cease our investments. Bouwinvest closed around € 1 billion in purchase transactions last year, which was in line with previous years. In the Netherlands, we invested in several healthcare real estate projects, as well as convenience retail and residential projects. In addition to this, we invested in logistics assets in Europe and Scandinavia, rental homes in Belgium, biomedical real estate in the United States and additional student accommodation in Australia.
At this moment, 81% of our invested capital is invested sustainably and we have no plans to reduce our efforts on this front. We have made a clear commitment to making all our investments Paris Proof by 2045. In addition to sustainability, our strategy also includes continued globalisation. In that context, we invested € 727 million abroad and in September we opened our representative office in New York. Last year, we added six employees to our workforce and completed the management team with the arrival of Mark Siezen as Chief Client Officer as per 1 November.
The 2020 Covid-19 crisis led to a lot of changes in how we work and will also leave its mark on real estate markets worldwide. The crisis accelerated numerous existing trends and developments, but did not create any new trends. As a long-term investor, we will continue to focus on the added value of real estate for our investors, tenants and other stakeholders under the motto real value for life.
We will have to deal with a number of challenges along the way. As the past year has made all too clear, we are operating in an unpredictable environment. But people are social creatures. Once we have dealt with this pandemic, they will quickly seek each other out again in hotels, shops and offices. For them, we invest in attractive living and working environments that offer opportunities for experience; places with lots of amenities where people can find inspiration.
The pandemic has had a major impact on the management of our portfolios. The days of battling to work in busy peak periods are over; working from home will result in different housing needs or less office use. We will continue to respond to those changes. We will also have to continue to devote attention to keeping inner cities liveable and vital. We are faced with a global surplus of retail space and store transformations are now inevitable.
The warming of the earth is now a fact, and we are already seeing the impact of this on our climate. This will affect a large proportion of the physical environment, which is why we have to put climate adaptation high on our agenda. This is why in 2021 we will be conducting an additional study into climate risks, to gain a clear understanding of how resilient our portfolios are in the face of storms, heavy rains, heat, floods and soil subsidence.
Looking back on 2020, I would like to thanks our clients for their understanding and undiminished trust in Bouwinvest during the crisis we all experienced in 2020. I am also proud of the resilience shown by our employees over the past year. Many of them have young children and were forced to combine their work with home schooling. The past year has been particularly difficult for people living in small homes, care givers and people who felt lonely. Our results underline the fact that our employees managed to keep everything under control. I would like to take this opportunity to thank them for that. Finally, I would like to thank the members of our Supervisory Board for their advice and constructive supervision.
Dick van Hal
CEO and statutory director