The future returns for property required by UK pension funds

In the 1970s Real Estate represented over 17% of the average pension funds total assets. Today such funds hold less than 4%, a figure not seen since the 1960s. This reduction in Real Estate holdings is mainly attributable to the relatively poor performance of Real Estate against other asset classes since the 1980s. Whether pension funds will increase their holding at any point in the future depends therefore on the expected return of Real Estate by comparison with that required to justify a particular asset holding. Using the technique of Modern Portfolio Theory (MPT), this paper assesses the required return that Real Estate would have to offer to justify a 15% holding in a mixed asset portfolio. This figure and the risk/return characteristics of the major asset classes is taken from survey data. Under a number of scenarios it is found that Real Estate can play a part in a mixed asset portfolio at the 15% level. In some cases however, the expected returns of Real Estate are not sufficient to justify a weight of 15% in this asset.

The future returns for property required by UK pension funds: the BHS data

Previous studies of the place of Property in the multi-asset portfolio have generally relied on historical data, and have been concerned with the supposed risk reduction effects that Property would have on such portfolios. In this paper a different approach has been taken. Not only are expectations data used, but we have also concentrated upon the required return that Property would have to offer to achieve a holding of 15% in typical UK pension fund portfolios. Using two benchmark portfolios for pension funds, we have shown that Property's required return is less than that expected, and therefore it could justify a 15% holding.

Using HIT to deliver integrated care for the frail elderly in the UK: current barriers and future challenges

In this paper we briefly describe the results of a 3 year project examining the use of Health Information Technologies (e.g., electronic patient record systems) to deliver integrated care. In particular, we focus on one group of patient (the frail elderly) and efforts to design an e-health supported healthcare pathway (the frail elderly pathway – FEP). The aim of FEP is to bring together clinicians and staff from health and social care and allow them to share patient information. Our findings show that progress in delivering a fully-supported and working FEP has been slow, not least because of the difficulties experienced by healthcare staff in using current IT systems. In addition, there are many strategic and technical issues which remain unresolved (e.g., systems interoperability).

Past, present and future change in the Atlantic meridional overturning circulation

Observations and numerical modelling experiments provide evidence for links between variability in the Atlantic Meridional Overturning Circulation (AMOC) and global climate patterns. Reduction in the strength of the overturning circulation is thought to have played a key role in rapid climate change in the past and may have the potential to significantly influence climate change in the future, as noted in the last two IPCC assessment reports (2001, 2007). Both IPCC reports also highlighted the significant uncertainties that exist regarding the future behaviour of the AMOC under global warming. Model results suggest that changes in the AMOC can impact surface air temperature, precipitation patterns and sea level, particularly in areas bordering the North Atlantic, thus affecting human populations. Here current understanding of past, present and future change in the AMOC and the effects of such changes on climate are reviewed. The focus is on observations of the AMOC, how the AMOC influences climate and in what way the AMOC is likely to change over the next few decades and the 21st 34 century. The potential for decadal prediction of the AMOC is also discussed. Finally, the outstanding challenges and possible future directions for AMOC research are outlined.

Prebiotics and the health benefits of fiber: current regulatory status, future research, and goals.

First defined in the mid-1990s, prebiotics, which alter the composition and activity of gastrointestinal (GI) microbiota to improve health and well-being, have generated scientific and consumer interest and regulatory debate. The Life Sciences Research Organization, Inc. (LSRO) held a workshop, Prebiotics and the Health Benefits of Fiber: Future Research and Goals, in February 2011 to assess the current state of the science and the international regulatory environment for prebiotics, identify research gaps, and create a strategy for future research. A developing body of evidence supports a role for prebiotics in reducing the risk and severity of GI infection and inflammation, including diarrhea, inflammatory bowel disease, and ulcerative colitis as well as bowel function disorders, including irritable bowel syndrome. Prebiotics also increase the bioavailability and uptake of minerals and data suggest that they reduce the risk of obesity by promoting satiety and weight loss. Additional research is needed to define the relationship between the consumption of different prebiotics and improvement of human health. New information derived from the characterization of the composition and function of different prebiotics as well as the interactions among and between gut microbiota and the human host would improve our understanding of the effects of prebiotics on health and disease and could assist in surmounting regulatory issues related to prebiotic use.

What influence will future solar activity changes over the 21st century have on projected global near-surface temperature changes?

During the 20th century, solar activity increased in magnitude to a so-called grand maximum. It is probable that this high level of solar activity is at or near its end. It is of great interest whether any future reduction in solar activity could have a significant impact on climate that could partially offset the projected anthropogenic warming. Observations and reconstructions of solar activity over the last 9000 years are used as a constraint on possible future variations to produce probability distributions of total solar irradiance over the next 100 years. Using this information, with a simple climate model, we present results of the potential implications for future projections of climate on decadal to multidecadal timescales. Using one of the most recent reconstructions of historic total solar irradiance, the likely reduction in the warming by 2100 is found to be between 0.06 and 0.1 K, a very small fraction of the projected anthropogenic warming. However, if past total solar irradiance variations are larger and climate models substantially underestimate the response to solar variations, then there is a potential for a reduction in solar activity to mitigate a small proportion of the future warming, a scenario we cannot totally rule out. While the Sun is not expected to provide substantial delays in the time to reach critical temperature thresholds, any small delays it might provide are likely to be greater for lower anthropogenic emissions scenarios than for higher-emissions scenarios.

Future change of precipitation extremes in Europe: intercomparison of scenarios from regional climate mode

An analysis of the climate of precipitation extremes as simulated by six European regional climate models (RCMs) is undertaken in order to describe/quantify future changes and to examine/interpret differences between models. Each model has adopted boundary conditions from the same ensemble of global climate model integrations for present (1961–1990) and future (2071–2100) climate under the Intergovernmental Panel on Climate Change A2 emission scenario. The main diagnostics are multiyear return values of daily precipitation totals estimated from extreme value analysis. An evaluation of the RCMs against observations in the Alpine region shows that model biases for extremes are comparable to or even smaller than those for wet day intensity and mean precipitation. In winter, precipitation extremes tend to increase north of about 45°N, while there is an insignificant change or a decrease to the south. In northern Europe the 20-year return value of future climate corresponds to the 40- to 100-year return value of present climate. There is a good agreement between the RCMs, and the simulated change is similar to a scaling of present-day extremes by the change in average events. In contrast, there are large model differences in summer when RCM formulation contributes significantly to scenario uncertainty. The model differences are well explained by differences in the precipitation frequency and intensity process, but in all models, extremes increase more or decrease less than would be expected from the scaling of present-day extremes. There is evidence for a component of the change that affects extremes specifically and is consistent between models despite the large variation in the total response.

Home-ownership for future generations

This paper constructs a housing market model to analyse conditions for different generations of households in the UK. Previous policy work has suggested that baby-boomers have benefitted at the expense of younger generations. The model relies on a form of financial accelerator in which existing homeowners reinvest a proportion of the capital gains on moving home. The model is extended to look at homeownership probabilities. It also explains why an increasing share of mortgages has gone to existing owners, despite market liberalisation and securitisation. In addition, the model contributes to the explanation of volatility.

New direct payments scheme: targeting and redistribution in the future CAP

The Commission has proposed that a revised version of the present regime of direct payments should be rolled forward into the post-2013 CAP. There would be a limited redistribution of funds between Member States. Thirty per cent of the budget would be allocated to a new greening component, which would be problematic in the WTO. Non-active farmers would not qualify for aid; and payments would be capped. Special schemes would be introduced for small farmers, for young new entrants, and for disadvantaged regions.

Facing the future: energy performance certificates and commercial property

Purpose – The paper aims to present the findings of a “situation review” of the Energy Performance of Buildings Directive (EPBD), focusing on energy performance certificates (EPCs) to highlight areas of specific importance for the UK property investment community. The paper is based on research commissioned by the Investment Property Forum (IPF) and funded through the IPF Research Programme (2006-2009). Design/methodology/approach – Interviews were undertaken with experts from the fields of property investment and building engineering. The interviews were undertaken with to identify: the current knowledge of EPCs in the property investment sector; key issues with practical implementation of the legislation; and perceptions of the potential impacts of legislation, particularly in relation to value stakeholder and behaviour. Findings – The paper finds that, although the regulations have been published, there is still a need for clarification in the marketplace with regard to some of the detail of regulations and the certification process. The following areas are of most concern to property investors: costs of surveys; potential difficulties with the process; and a shortage of assessors. With respect to these impacts it is becoming clear that investors who have not yet started considering the EPBD and its requirements within their strategy are likely to face difficulties in the short term. The most significant value-related impacts of EPBD are expected to be value differentiation of properties and “price chipping” against the rental or capital value of the property, where an occupier or potential purchaser will use the recommendations contained within an EPC to force a reduction in value. The latter is expected to emerge in the short term, whereas the former is expected to be realised over the medium to long term. Both these impacts have potentially significant implications for property investment holdings and also future investment behaviour.

The roles of aerosol, water vapor and cloud in future global dimming/brightening

Observational evidence indicates significant regional trends in solar radiation at the surface in both all-sky and cloud-free conditions. Negative trends in the downwelling solar surface irradiance (SSI) have become known as ‘dimming’ while positive trends have become known as ‘brightening’. We use the Met Office Hadley Centre HadGEM2 climate model to model trends in cloud-free and total SSI from the pre-industrial to the present-day and compare these against observations. Simulations driven by CMIP5 emissions are used to model the future trends in dimming/brightening up to the year 2100. The modeled trends are reasonably consistent with observed regional trends in dimming and brightening which are due to changes in concentrations in anthropogenic aerosols and, potentially, changes in cloud cover owing to the aerosol indirect effects and/or cloud feedback mechanisms. The future dimming/brightening in cloud-free SSI is not only caused by changes in anthropogenic aerosols: aerosol impacts are overwhelmed by a large dimming caused by increases in water vapor. There is little trend in the total SSI as cloud cover decreases in the climate model used here, and compensates the effect of the change in water vapor. In terms of the surface energy balance, these trends in SSI are obviously more than compensated by the increase in the downwelling terrestrial irradiance from increased water vapor concentrations. However, the study shows that while water vapor is widely appreciated as a greenhouse gas, water vapor impacts on the atmospheric transmission of solar radiation and the future of global dimming/brightening should not be overlooked.

Construction management research at the individual-level of analysis: current status, gaps and future directions

Individual-level constructs are seldom taken into consideration in construction management research relating to project performance. This is antithetical to the objectives of properly conceptualizing and contextualizing the research we do because many project performance outcomes, such as the extent of cooperation and level of communication or teamwork are influenced and moderated by individuals’ perceptions, values and behaviour. A brief review of the literature in organizational studies centred on culture, identity, empowerment and trust is offered. These constructs are then explored in relation to project performance issues and outcomes, and it is noted that they are predominantly studied at the project and industry levels. We argue that focusing these constructs at the individual unit of analysis has significant implications for project performance and therefore their effects need to be systematically accounted for in explanations of the success and failure of projects. Far from being prescriptive, the aim is to generate interest and awareness for more focused research at the individual level of analysis in order to add new insights and perspectives to critical performance questions in construction management. To this end, a research agenda is outlined, arguing that construction management research integrating individual-level constructs and broader, macro-contextual issues will help define and enhance the legitimacy of the field.

Flooding tolerance in four 'Garrigue' landscape plants: implications for their future use in the urban landscapes of north-west Europe?

Within a changing climate, Mediterranean ‘Garrigue’ xerophytes are increasingly recommended as suitable urban landscape plants in north-west Europe, based on their capacity to tolerate high temperature and reduced water availability during summer. Such species, however, have a poor reputation for tolerating waterlogged soils; paradoxically a phenomenon that may also increase in north-west Europe due to predictions for both higher volumes of winter precipitation, and short, but intensive periods of summer rainfall. This study investigated flooding tolerance in four landscape ‘Garrigue’ species, Stachys byzantina, Cistus × hybridus, Lavandula angustifolia and Salvia officinalis. Despite evolving in a dry habitat, the four species tested proved remarkably resilient to flooding. All species survived 17 days flooding in winter, with Stachys and Lavandula also surviving equivalent flooding duration during summer. Photosynthesis and biomass production, however, were strongly inhibited by flooding although the most tolerant species, Stachys quickly restored its photosynthetic capacity on termination of flooding. Overall, survival rates were comparable to previous studies on other terrestrial (including wetland) species. Subsequent experiments using Salvia (a species we identified as ‘intermediate’ in tolerance) clearly demonstrated adaptations to waterlogging, e.g. acclimation against anoxia when pre-treated with hypoxia. Despite anecdotal information to the contrary, we found no evidence to suggest that these xerophytic species are particularly intolerant of waterlogging. Other climatic and biotic factors may restrict the viability and distribution of these species within the urban conurbations of north-west Europe, but we believe increased incidence of flooding per se should not preclude their consideration.

Mobilising community action towards a low-carbon future: Opportunities and challenges for local government in the UK

Over the last decade the important role that local authorities can play in catalyzing communityaction on climate change has been repeatedly emphasised by the UK Government. The paper examines this policy context and explores the options available to local authorities in terms of reaching and engaging their communities. The type of progressive response shown by some UKlocal authorities is illustrated with empirical evidence gathered through a study conducted in the London Borough of Islington focusing on their recently established ‘Green Living Centre’. The results confirm interest in this major council-led community initiative, with positive attitudes expressed by the majority of those questioned in terms of the advice and information available. However, it is also clear that many participants had preexisting pro-environmental attitudes and behavioural routines. Results from a broader sample of Islington residents indicate a substantial challenge in reaching the wider community, where enthusiasm for sustainability change and interest in this type of scheme were more mixed. The prospect for local government in addressing this challenge – and their ability to trigger and capitalize upon concepts of social change at the community level towardsalowercarbon future – is discussed in the final part of the paper.