1 00:00:03,930 --> 00:00:07,530 Jennifer Duke: Welcome to the Fear and Greed Business interview. I'm Jennifer Duke. 2 00:00:07,800 --> 00:00:10,289 Jennifer Duke: We talk about all kinds of investments here, and there's 3 00:00:10,289 --> 00:00:12,480 Jennifer Duke: a lot to learn from talking to some of the big, 4 00:00:12,480 --> 00:00:15,389 Jennifer Duke: global players, and that's about the trends they're noticing and 5 00:00:15,389 --> 00:00:18,360 Jennifer Duke: where they see the opportunities for investors. And today we're 6 00:00:18,390 --> 00:00:20,639 Jennifer Duke: going to talk about Nuveen. It is one of the 7 00:00:20,640 --> 00:00:24,840 Jennifer Duke: world's largest investment managers with US$1.1 trillion US dollars in assets 8 00:00:24,840 --> 00:00:29,340 Jennifer Duke: under management. And within that, is Nuveen's US$170 billion US dollars 9 00:00:29,340 --> 00:00:32,668 Jennifer Duke: Real Assets business. Of course, please remember, this is general 10 00:00:32,670 --> 00:00:36,239 Jennifer Duke: information only. You should definitely seek professional advice before making 11 00:00:36,239 --> 00:00:39,239 Jennifer Duke: any investment decisions, but today we've got the opportunity to 12 00:00:39,240 --> 00:00:42,060 Jennifer Duke: speak to Mike Sales, Head of Nuveen Real Assets, who's 13 00:00:42,060 --> 00:00:44,909 Jennifer Duke: actually in Australia at the moment. Mike, welcome to Fear 14 00:00:44,909 --> 00:00:45,420 Jennifer Duke: and Greed. 15 00:00:45,930 --> 00:00:46,409 Mike Sales: Thank you very much, Jen. Nice to be here. 16 00:00:48,030 --> 00:00:50,519 Jennifer Duke: So the bulk of Nuveen Real Assets is made up 17 00:00:50,519 --> 00:00:53,219 Jennifer Duke: of Nuveen Real Estate, and globally, how are you seeing 18 00:00:53,219 --> 00:00:54,720 Jennifer Duke: this sector this year? It's been a bit of a 19 00:00:54,720 --> 00:00:55,590 Jennifer Duke: volatile one. 20 00:00:56,580 --> 00:01:00,210 Mike Sales: It certainly has, Jen. I think we can't be too 21 00:01:00,240 --> 00:01:03,120 Mike Sales: pessimistic about what's happening to real estate given the sort 22 00:01:03,120 --> 00:01:06,539 Mike Sales: of 12 year run we've had since the last GFC. 23 00:01:06,690 --> 00:01:09,479 Mike Sales: But certainly it's been a challenging year for real estate, 24 00:01:09,480 --> 00:01:12,029 Mike Sales: and driven, as you well know, and the listeners will 25 00:01:12,029 --> 00:01:15,000 Mike Sales: well know by the rise in interest rates, and the 26 00:01:15,000 --> 00:01:19,619 Mike Sales: fact that yields have had to rise, valuations drop accordingly. 27 00:01:20,280 --> 00:01:22,200 Jennifer Duke: We've also had quite a bit of news out of 28 00:01:22,200 --> 00:01:23,969 Jennifer Duke: China. Do you have any thoughts about how that space 29 00:01:23,969 --> 00:01:25,020 Jennifer Duke: is affecting the outlook? 30 00:01:25,980 --> 00:01:28,649 Mike Sales: Yeah, look, China is a big part of the global economy, 31 00:01:28,709 --> 00:01:32,760 Mike Sales: and China, in growth mode, is obviously very positive for 32 00:01:32,760 --> 00:01:35,280 Mike Sales: the wider economy. We don't have a huge amount of 33 00:01:35,280 --> 00:01:38,639 Mike Sales: exposure to the Chinese market, but clearly it has a 34 00:01:38,639 --> 00:01:42,630 Mike Sales: bearing on the global economy which ultimately feeds through to 35 00:01:43,080 --> 00:01:44,999 Mike Sales: what you see in growth globally. 36 00:01:45,509 --> 00:01:48,300 Jennifer Duke: And what are you hearing from Australian institutional investors at the 37 00:01:48,300 --> 00:01:50,400 Jennifer Duke: moment? Where are they putting their money within the real 38 00:01:50,400 --> 00:01:51,120 Jennifer Duke: estate sector? 39 00:01:52,170 --> 00:01:55,230 Mike Sales: We've done a lot of business with Australian investors over 40 00:01:55,230 --> 00:01:58,530 Mike Sales: the course of the last 15 years. And the great 41 00:01:58,530 --> 00:02:02,849 Mike Sales: thing about Australian investors, and superannuation funds particularly, and now 42 00:02:02,849 --> 00:02:05,879 Mike Sales: moving into the wealth market, really smart about where they 43 00:02:05,879 --> 00:02:09,810 Mike Sales: invest and they're mostly very long-term investors. So looking for 44 00:02:09,810 --> 00:02:14,130 Mike Sales: those demographic tailwinds to invest in sectors that they think are 45 00:02:14,130 --> 00:02:16,918 Mike Sales: going to be the sectors, not just of today, but tomorrow. 46 00:02:16,919 --> 00:02:20,460 Mike Sales: So we've seen investment in a variety of, not just 47 00:02:20,460 --> 00:02:25,169 Mike Sales: different sectors, but geographies around the world depending on market conditions. 48 00:02:25,169 --> 00:02:28,200 Mike Sales: So in terms of things that we like and we're 49 00:02:28,200 --> 00:02:32,040 Mike Sales: talking to institutions about at the moment, we particularly like storage, 50 00:02:32,309 --> 00:02:36,720 Mike Sales: that's a global story, medical office, senior living, to name three. 51 00:02:37,530 --> 00:02:40,019 Jennifer Duke: And one of the other trends, and I know that you are very interested 52 00:02:40,829 --> 00:02:43,260 Jennifer Duke: in this as well, but ESG is a big theme 53 00:02:43,260 --> 00:02:46,139 Jennifer Duke: for institutional investors and across, I suppose, the economy right 54 00:02:46,139 --> 00:02:49,080 Jennifer Duke: now, and all sectors really. But what does it look 55 00:02:49,080 --> 00:02:50,580 Jennifer Duke: like in real estate specifically? 56 00:02:51,570 --> 00:02:55,049 Mike Sales: Well, look, real estate is responsible for a very large 57 00:02:55,049 --> 00:02:59,190 Mike Sales: percentage of global emissions. And one of the most interesting 58 00:02:59,190 --> 00:03:02,280 Mike Sales: sectors that is suffering at the moment is the office 59 00:03:02,280 --> 00:03:06,750 Mike Sales: sector because that's clearly a huge driver of emissions. And 60 00:03:06,750 --> 00:03:09,238 Mike Sales: so what you are seeing now is a real trend 61 00:03:09,240 --> 00:03:13,469 Mike Sales: towards creating very green buildings that the tenants and their 62 00:03:13,469 --> 00:03:17,549 Mike Sales: stakeholders, their employees, want to occupy. And a real move 63 00:03:17,549 --> 00:03:21,780 Mike Sales: away from secondhand, older space. Of course, that secondhand, older 64 00:03:21,780 --> 00:03:24,750 Mike Sales: space needs to be repurposed. The cost of doing that 65 00:03:24,750 --> 00:03:29,309 Mike Sales: though is quite prohibitive, particularly in a market where valuations 66 00:03:29,309 --> 00:03:32,309 Mike Sales: are challenged, the cost of debt has risen substantially. So 67 00:03:32,309 --> 00:03:35,609 Mike Sales: there is a real bifurcation from an ESG perspective, in 68 00:03:35,609 --> 00:03:37,290 Mike Sales: the office market, as one example. 69 00:03:37,800 --> 00:03:39,540 Jennifer Duke: So how do you get over that hump of having 70 00:03:39,540 --> 00:03:42,390 Jennifer Duke: that office building, the older office building, that needs to 71 00:03:42,390 --> 00:03:44,879 Jennifer Duke: be redeployed, I suppose we can describe it as? 72 00:03:45,389 --> 00:03:48,809 Mike Sales: Yeah, no, it's a good question. And the reality is, 73 00:03:49,230 --> 00:03:52,529 Mike Sales: the valuation basis has to be right. So someone has 74 00:03:52,529 --> 00:03:54,510 Mike Sales: to be able to look at that office building and 75 00:03:54,809 --> 00:03:58,980 Mike Sales: make a financial return from turning it back into a 76 00:03:58,980 --> 00:04:03,240 Mike Sales: green building. And right now, I don't think valuations probably 77 00:04:03,630 --> 00:04:05,099 Mike Sales: are where they need to be for some of those 78 00:04:05,099 --> 00:04:07,859 Mike Sales: older buildings for somebody to take on that task. 79 00:04:08,400 --> 00:04:11,309 Jennifer Duke: Definitely a big challenge ahead. I'm curious as well around 80 00:04:11,309 --> 00:04:13,259 Jennifer Duke: your thoughts on the work from home shift and how 81 00:04:13,260 --> 00:04:15,600 Jennifer Duke: that's affecting the commercial space. Is that something that's here 82 00:04:15,600 --> 00:04:16,050 Jennifer Duke: to stay? 83 00:04:17,430 --> 00:04:20,039 Mike Sales: It is very difficult to have discussion about this because 84 00:04:20,370 --> 00:04:23,489 Mike Sales: I feel so strongly about it, but that's because I 85 00:04:23,490 --> 00:04:26,549 Mike Sales: work in the private markets and some might say I'm 86 00:04:26,549 --> 00:04:29,759 Mike Sales: biased because I'm in the real estate sector. But being 87 00:04:29,760 --> 00:04:32,909 Mike Sales: in the private markets, big believer in people being in 88 00:04:32,910 --> 00:04:35,250 Mike Sales: the office, and not just in the office, but in 89 00:04:35,730 --> 00:04:40,830 Mike Sales: client's offices, other stakeholders offices, because that's what private markets 90 00:04:40,830 --> 00:04:43,320 Mike Sales: are about, it's about the transfer of information as well 91 00:04:43,320 --> 00:04:47,759 Mike Sales: as the well-documented development of people, et cetera. So I 92 00:04:47,760 --> 00:04:51,419 Mike Sales: think some form of hybrid work is of course here 93 00:04:51,420 --> 00:04:54,240 Mike Sales: to stay because we've all learned to work from home. 94 00:04:54,660 --> 00:04:57,120 Mike Sales: But I do think the numbers are suggesting that we 95 00:04:57,120 --> 00:05:01,229 Mike Sales: are seeing a slow trickle back to far more days 96 00:05:01,230 --> 00:05:03,748 Mike Sales: in the office, if that's the right expression. And look, 97 00:05:03,750 --> 00:05:06,029 Mike Sales: some of that is driven by what's happening in the 98 00:05:06,029 --> 00:05:08,640 Mike Sales: economy and the fact that the job market is not 99 00:05:08,640 --> 00:05:12,479 Mike Sales: as particularly robust as it was perhaps 18 months ago. 100 00:05:13,050 --> 00:05:14,849 Jennifer Duke: Stay with me, Mike, we'll be back in a minute. 101 00:05:21,210 --> 00:05:24,359 Jennifer Duke: I'm speaking to Mike Sales, Head of Nuveen Real Assets. 102 00:05:25,169 --> 00:05:27,599 Jennifer Duke: I want to talk to you about Nuveen Natural Capital. So 103 00:05:27,600 --> 00:05:30,900 Jennifer Duke: that's another part of Nuveen Real Assets. And for our 104 00:05:30,900 --> 00:05:34,828 Jennifer Duke: listeners, Nuveen's actually the largest manager of farmland globally with 105 00:05:34,830 --> 00:05:37,620 Jennifer Duke: more than 3 million acres of farmland and timberland, and 106 00:05:37,620 --> 00:05:40,289 Jennifer Duke: that's across about 600 properties in 10 countries. This is 107 00:05:40,619 --> 00:05:42,990 Jennifer Duke: a pretty big part of the business. What is it 108 00:05:42,990 --> 00:05:46,020 Jennifer Duke: about this space that you think makes it attractive to investors? 109 00:05:46,950 --> 00:05:48,779 Mike Sales: Well, I'm very impressed by your facts. I'm not sure 110 00:05:48,779 --> 00:05:52,469 Mike Sales: I could have rolled those ones out, but it's a 111 00:05:52,469 --> 00:05:56,669 Mike Sales: really interesting investment. Again, everything we do is driven by 112 00:05:57,450 --> 00:06:00,118 Mike Sales: global mega- trends and tailwinds, and you only have to 113 00:06:00,119 --> 00:06:05,430 Mike Sales: look at population growth and what's likely to happen, how 114 00:06:05,430 --> 00:06:10,110 Mike Sales: we need to increase the provision of food, protein, et cetera, 115 00:06:10,440 --> 00:06:13,949 Mike Sales: to that population to realise that farmland is, it's a 116 00:06:13,950 --> 00:06:17,669 Mike Sales: finite resource, and therefore not just a finite resource, but 117 00:06:17,699 --> 00:06:20,820 Mike Sales: also something that we need to look after. And also 118 00:06:20,820 --> 00:06:24,780 Mike Sales: from an ESG perspective as well. So we think farmland 119 00:06:24,870 --> 00:06:31,169 Mike Sales: has always offered very steady inflation-adjusted returns. It's particularly had 120 00:06:31,170 --> 00:06:34,950 Mike Sales: a very strong last three years. But I think going forward, 121 00:06:35,369 --> 00:06:39,390 Mike Sales: I think the interesting thing about agriculture and indeed forestry, 122 00:06:39,390 --> 00:06:43,349 Mike Sales: which makes up Natural Capital for us is all the 123 00:06:43,350 --> 00:06:46,470 Mike Sales: benefits it's going to bring in terms of carbon sequestration, 124 00:06:46,740 --> 00:06:51,719 Mike Sales: improving habitats and improving and protecting biodiversity, which is going 125 00:06:51,719 --> 00:06:53,940 Mike Sales: to become more and more of an issue going forward. 126 00:06:53,940 --> 00:06:57,419 Mike Sales: So I think it's hugely impactful. I think investors are 127 00:06:57,420 --> 00:06:59,790 Mike Sales: focused on that as well as return. They're not going 128 00:06:59,790 --> 00:07:03,839 Mike Sales: to sacrifice return, but they will certainly be led towards 129 00:07:03,839 --> 00:07:05,969 Mike Sales: these sorts of sectors which do both. 130 00:07:08,520 --> 00:07:11,340 Jennifer Duke: And when you are considering these sorts of land-focused assets, what are the criteria that you 131 00:07:11,340 --> 00:07:12,029 Jennifer Duke: put in place? 132 00:07:12,869 --> 00:07:14,820 Mike Sales: So look, a couple of things to say from where 133 00:07:14,820 --> 00:07:17,460 Mike Sales: I sit, there are a couple of things about where 134 00:07:17,460 --> 00:07:21,000 Mike Sales: we invest in farmland and timber. First of all, we 135 00:07:21,000 --> 00:07:23,639 Mike Sales: want to do it globally because we need to be 136 00:07:23,639 --> 00:07:28,019 Mike Sales: diverse from a climate perspective, because different parts of the world, 137 00:07:28,619 --> 00:07:31,620 Mike Sales: climates are evolving in different ways. So that's number one. 138 00:07:31,620 --> 00:07:34,320 Mike Sales: The second one is, do we want to be an operator? 139 00:07:34,770 --> 00:07:36,570 Mike Sales: And we tend to do that when we look at 140 00:07:36,570 --> 00:07:40,679 Mike Sales: permanent crops. So when you look at vineyards, tree nuts, 141 00:07:40,679 --> 00:07:43,259 Mike Sales: et cetera, which are more permanent, we want to operate 142 00:07:43,259 --> 00:07:46,500 Mike Sales: and control production there. And then we tend to lease 143 00:07:46,500 --> 00:07:50,700 Mike Sales: out row crops, things like wheat, barley, et cetera, obviously 144 00:07:50,700 --> 00:07:55,170 Mike Sales: to local farmers and co-ops. So that's the high level. 145 00:07:55,470 --> 00:07:58,829 Mike Sales: Then it's around diversifying the crop base. So we have 146 00:07:58,950 --> 00:08:02,580 Mike Sales: a vast array of crops that we look after globally, 147 00:08:02,610 --> 00:08:05,699 Mike Sales: and I think it's depending on the strategy and the portfolio, 148 00:08:05,699 --> 00:08:07,469 Mike Sales: is making sure we've got the right mix. 149 00:08:07,919 --> 00:08:11,640 Jennifer Duke: That's actually fascinating. I'm also curious because in Australia right 150 00:08:11,640 --> 00:08:13,710 Jennifer Duke: now we're going through a bit of a discussion about 151 00:08:13,710 --> 00:08:17,759 Jennifer Duke: immigration and the workplace, and I'm curious about your thoughts 152 00:08:17,759 --> 00:08:20,610 Jennifer Duke: about how immigration is affecting the real estate sector. Not 153 00:08:20,610 --> 00:08:22,950 Jennifer Duke: sure if you are having the same trends in the UK. 154 00:08:24,240 --> 00:08:28,050 Mike Sales: I don't think as much perhaps as Australia, but the one 155 00:08:28,050 --> 00:08:32,608 Mike Sales: seeming consequence of that is the way that the housing 156 00:08:32,610 --> 00:08:35,879 Mike Sales: market has held up here, or it seems to have 157 00:08:35,880 --> 00:08:38,759 Mike Sales: held up here far better than it has perhaps in 158 00:08:38,940 --> 00:08:42,690 Mike Sales: other countries. And that's probably because the interest rate rises 159 00:08:42,720 --> 00:08:45,780 Mike Sales: have happened down here later than perhaps somewhere like the 160 00:08:45,780 --> 00:08:50,699 Mike Sales: UK. But I think that's the obvious, I hesitate when 161 00:08:50,700 --> 00:08:55,710 Mike Sales: I say the benefit to the housing sector of immigration, 162 00:08:55,710 --> 00:09:00,179 Mike Sales: but it's actually to, you could argue, detriment to a 163 00:09:00,179 --> 00:09:04,350 Mike Sales: lot of people because it pushes affordability out of many 164 00:09:04,350 --> 00:09:07,530 Mike Sales: people's hands. So I think that's the biggest issue that 165 00:09:07,530 --> 00:09:09,870 Mike Sales: needs to be resolved. It's something that we're big in, 166 00:09:09,929 --> 00:09:12,869 Mike Sales: in the US. It's slightly undeveloped as a sector here, 167 00:09:12,870 --> 00:09:17,699 Mike Sales: but affordable housing, given that immigration and the cost of 168 00:09:17,699 --> 00:09:21,328 Mike Sales: living and the cost of renting and indeed buying your 169 00:09:21,330 --> 00:09:24,838 Mike Sales: own house are somewhat prohibitive. So that's the same in 170 00:09:24,840 --> 00:09:27,809 Mike Sales: a lot of other global centers at the moment, although 171 00:09:28,139 --> 00:09:31,170 Mike Sales: prices have suffered as a result of interest rates moving 172 00:09:31,170 --> 00:09:33,420 Mike Sales: up sharper and earlier than down here. 173 00:09:36,000 --> 00:09:38,790 Jennifer Duke: That is very true. And one of the ways that policy decision makers here are responding to this sort 174 00:09:38,790 --> 00:09:42,390 Jennifer Duke: of change in immigration, and our concentration is to, I 175 00:09:42,390 --> 00:09:45,360 Jennifer Duke: suppose you could say, distribute our CBDs a little bit 176 00:09:45,360 --> 00:09:48,569 Jennifer Duke: more widely. We're obviously very concentrated in Sydney and Melbourne, 177 00:09:48,570 --> 00:09:51,240 Jennifer Duke: but there's smaller CBD and work centers being set up 178 00:09:51,540 --> 00:09:53,309 Jennifer Duke: in Parramatta. I'm not sure how familiar you are with 179 00:09:53,520 --> 00:09:56,340 Jennifer Duke: the geographies of our cities, but I'm curious about your 180 00:09:56,340 --> 00:10:00,358 Jennifer Duke: perspective on these mini CBDs and how successful they can 181 00:10:00,360 --> 00:10:02,580 Jennifer Duke: be from that commercial perspective in real estate. 182 00:10:03,389 --> 00:10:08,040 Mike Sales: Yeah, really interesting. I was in San Francisco a couple 183 00:10:08,040 --> 00:10:10,830 Mike Sales: of months ago, and there's a classic example of somewhere 184 00:10:11,219 --> 00:10:14,730 Mike Sales: where, look, there's a lot of differences clearly in terms 185 00:10:14,730 --> 00:10:17,580 Mike Sales: of how that city is run, but what you see 186 00:10:17,580 --> 00:10:19,590 Mike Sales: there is exactly as you've just described. And I don't 187 00:10:19,590 --> 00:10:22,860 Mike Sales: know the suburbs here as, clearly, as well as you 188 00:10:22,860 --> 00:10:26,459 Mike Sales: do, but that's where the suburbs of San Francisco have 189 00:10:26,520 --> 00:10:29,910 Mike Sales: sort of continued to thrive whilst the downtown has suffered 190 00:10:29,910 --> 00:10:34,470 Mike Sales: greatly. It's a really difficult one because you want a 191 00:10:34,470 --> 00:10:39,059 Mike Sales: vibrant city, you want everything that goes with that in 192 00:10:39,059 --> 00:10:44,249 Mike Sales: terms of hospitality, whether it's hotels, whether it's the restaurants, 193 00:10:44,250 --> 00:10:47,460 Mike Sales: whether it's the theaters, all those sorts of things. So 194 00:10:48,600 --> 00:10:50,910 Mike Sales: you want the best of both worlds, but there's no 195 00:10:50,910 --> 00:10:55,290 Mike Sales: doubt that these emerging suburbs, with their convenient shopping, have 196 00:10:55,290 --> 00:10:59,429 Mike Sales: emerged as real suburbs of interest from an investment perspective 197 00:10:59,429 --> 00:11:02,759 Mike Sales: because the one part of the retail market that stood up 198 00:11:02,759 --> 00:11:05,819 Mike Sales: is convenient shopping. And you're also beginning to see some 199 00:11:05,820 --> 00:11:08,819 Mike Sales: of the more innovative retailers take some of their retail 200 00:11:08,820 --> 00:11:11,910 Mike Sales: outlets and put them in some of these local suburbs, 201 00:11:11,910 --> 00:11:15,300 Mike Sales: given the shift, if you like, to this hybrid working 202 00:11:15,300 --> 00:11:16,470 Mike Sales: over the last couple of years. 203 00:11:18,870 --> 00:11:21,179 Jennifer Duke: And one big part of that, and I'm very curious about this 204 00:11:21,179 --> 00:11:23,669 Jennifer Duke: space because we've got a lot of super funds with 205 00:11:23,670 --> 00:11:26,309 Jennifer Duke: a huge amount of funds under management and lots of 206 00:11:26,309 --> 00:11:29,640 Jennifer Duke: interest in global infrastructure investments. What's the sort of outlook 207 00:11:29,640 --> 00:11:31,380 Jennifer Duke: for that space, given we're going to need a lot 208 00:11:31,380 --> 00:11:34,169 Jennifer Duke: of infrastructure to service these sorts of mini CBDs? 209 00:11:35,130 --> 00:11:38,728 Mike Sales: Yeah, no doubt. And depending on where you are in 210 00:11:38,730 --> 00:11:42,540 Mike Sales: the world, I think the biggest, or two biggest focus areas, 211 00:11:42,540 --> 00:11:47,460 Mike Sales: particularly for us are around the digital revolution, and getting 212 00:11:47,490 --> 00:11:51,719 Mike Sales: fibre and cell and data to people in a quicker fashion. 213 00:11:51,719 --> 00:11:54,840 Mike Sales: So I think that's a really interesting part of the 214 00:11:54,840 --> 00:11:59,309 Mike Sales: infrastructure market. The biggest focus for us is the electrification as 215 00:11:59,309 --> 00:12:04,410 Mike Sales: part of the energy transition where simply the demand for 216 00:12:04,410 --> 00:12:07,530 Mike Sales: electrification is, as you know, is- 217 00:12:07,920 --> 00:12:08,429 Jennifer Duke: Huge. 218 00:12:08,910 --> 00:12:13,469 Mike Sales: Considerable. I was going to say infinite, of course it's 219 00:12:13,469 --> 00:12:16,889 Mike Sales: not. But the reality is we've got to work out 220 00:12:16,889 --> 00:12:20,250 Mike Sales: ways of producing as much as we can as quickly 221 00:12:20,250 --> 00:12:22,680 Mike Sales: as we can and make sure that we can obviously 222 00:12:22,980 --> 00:12:25,500 Mike Sales: do everything that's associated with that in terms of storing 223 00:12:25,500 --> 00:12:27,780 Mike Sales: it, et cetera. So there's a huge amount of work 224 00:12:27,780 --> 00:12:30,000 Mike Sales: that needs to go on there. I think in terms 225 00:12:30,000 --> 00:12:32,159 Mike Sales: of where the market is for that now and how 226 00:12:32,160 --> 00:12:35,369 Mike Sales: the super funds are looking at some of these areas 227 00:12:35,369 --> 00:12:38,400 Mike Sales: of the infrastructure market, and I haven't touched on transportation, 228 00:12:38,700 --> 00:12:42,450 Mike Sales: is it's been affected like every other real asset class 229 00:12:42,450 --> 00:12:45,960 Mike Sales: by sharp interest rate rises, the increase in cost of 230 00:12:45,960 --> 00:12:49,200 Mike Sales: debt, the increase in cost of materials. We mentioned China 231 00:12:49,200 --> 00:12:53,039 Mike Sales: earlier, it's a major provider of most materials for offshore 232 00:12:53,039 --> 00:12:58,199 Mike Sales: and onshore wind turbines as an example. So we're particularly 233 00:12:58,200 --> 00:13:02,010 Mike Sales: focused on offshore and onshore wind and solar. We see 234 00:13:02,010 --> 00:13:06,719 Mike Sales: those as growing exponentially, but equally, we need to be 235 00:13:06,719 --> 00:13:09,179 Mike Sales: doing it at the right price to deliver the returns 236 00:13:09,179 --> 00:13:12,900 Mike Sales: that the superannuation funds and indeed global investors want. 237 00:13:13,620 --> 00:13:15,600 Jennifer Duke: Definitely. Look, thank you, we've covered an awful lot of 238 00:13:15,600 --> 00:13:18,270 Jennifer Duke: ground. Mike, thanks very much for speaking to Fear and Greed. 239 00:13:19,110 --> 00:13:19,530 Mike Sales: Thank you. 240 00:13:20,309 --> 00:13:23,100 Jennifer Duke: And that was Mike Sales, Head of Nuveen Real Assets. 241 00:13:23,190 --> 00:13:25,889 Jennifer Duke: This is the Fear and Greed Business Interview. Remember, this 242 00:13:25,889 --> 00:13:29,070 Jennifer Duke: is general information only and you should seek professional advice 243 00:13:29,070 --> 00:13:32,640 Jennifer Duke: before making any investment decisions. Join us every morning for 244 00:13:32,640 --> 00:13:35,340 Jennifer Duke: the full episode of Fear and Greed, Australia's best business 245 00:13:35,340 --> 00:13:39,240 Jennifer Duke: podcast. I'm Jennifer Duke, economics correspondent at Capital Brief, and 246 00:13:39,240 --> 00:13:41,280 Jennifer Duke: filling in for Sean Aylmer. Have a great day.