Real estate

Development offers outsized opportunities in the U.S. housing market

March 30, 2022 | 9 min read

Indraneel Karlekar, Ph.D.

Senior Managing Director, Global Head of Research & Portfolio Strategies

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Executive summary

Generational changes to the U.S. population are intersecting with COVID-19 creating sustained demand in the residential sector that will have long tailwinds.
A substantial shortage of housing, coupled with rising affordability issues, are generating significant demand for rental real estate, which has expanded beyond traditional apartments to include single-family homes, manufactured housing, and built-to-rent units.
The demand for residential real estate has also shifted into high gear among investors who recognize the acute need for housing and the increasingly broad swathe of options the sector can offer renters.
Markets that sit at the cross-roads of demographic change and “DIGITAL”¹ growth drivers offer some of the most compelling long-term investment opportunities in the residential sector.
We believe that development strategies offer the best risk-adjusted opportunities within the residential sector by generating significant return premium over core, stabilized assets. Further, a development-oriented approach offers the ability to tailor assets and formats to meet shifting tenant profile, including more ESG-related amenities and, meet and exceed inflationary pressures by covering increasing material and labor costs via increased stabilized asset values

Shifting demographic patterns intersect with COVID-19 to set up sustained residential demand

The U.S. economy is undergoing a demographic shift as the post-war (baby-boomer) generation exits the workforce. By 2025, population projections from the U.S. Census Bureau indicate there will be 66 million baby boomers and 140 million millennials and members of generation Z, with the latter entering peak rental years and the former requiring more varied housing options (Exhibit 1).² While this structural shift has been underway over the past decade, COVID-19 disrupted the labor market substantially, putting millions out of work, particularly millennials and members of generation Z. In fact, 32.8% of young adults, 24.3 million people between the ages of 18 and 34, were living at home in 2021.³ With the pandemic receding and the labor market rapidly recovering, the structural shifts are resuming and, along with some changes brought about by COVID-19, triggering a material increase in residential demand across much of the U.S.

Exhibit 1: Millennials and Gen Z’s are now the dominant demographic groups
Projected population by generation

Forecasted time series chart from 2021 to 2060 showing population by generation

U.S. Census Bureau, Principal Real Estate Investors, 2021 Projections for the United States: 2017 to 2060.

As a result of the generational demographic shift, the renter pool has expanded along with the income composition of the groups looking to enter various segments of the rental market. A key feature of the U.S. economy has been wage stagnation over the past two decades, which has increased household income inequality. Over 65% of U.S. households have an annual income of under $100,000⁴—a segment where housing supply is stretched but demand remains very strong (see Exhibit 2). This “middle-income” segment of the U.S. offers a large, growing, and important target set for residential investment.

Exhibit 2: U.S. household distribution by income ranges
Annual household income in U.S. dollars

Bar chart showing percentages of annual household income in U.S. dollars segmented by income bands

U.S. Census Bureau (Current Population Survey, ASEC), Principal Real Estate Investors Calculations, 2021

The housing shortage is exacerbated by low affordability metrics particularly in coastal and gateway markets where many baby boomers transitioning from single-family homes are looking to unlock decades of equity. At the same time, many potential first-time homebuyers are facing lofty home prices and the prospect of rising interest rates, forcing them to move to lower cost of living cities or to become renters by necessity. Many of these lower cost markets are in the sunbelt regions where high population and economic growth prospects are driving outsized rent growth. A lack of residential supply, along with highly skilled workforces and the prevalence of DIGITAL industries, is also creating housing opportunities in many larger gateway markets despite slower population growth (Exhibit 3). The U.S. residential market has become a broader and more vibrant universe catering to an equally diverse and growing universe of renters.

Exhibit 3: Population increases and skilled workforce drive rental growth
Population and rent growth
5-year annualized % change

Scatter plot showing the five-year annualized percentage change of population growth by effective rent growth percentage in U.S. cities

U.S. Census Bureau, REIS, Moody’s Analytics, Principal Real Estate Investors, Q4 2021

This intersection of demographic shifts with pandemic-related catalysts are creating some discernible trends that will impact investment opportunities, which we identify as:

Most of the metropolitan population in the U.S. is in suburban locations (61.9%) compared with central city locations (38.1%). Between 2016 and 2021 the suburban population growth averaged 0.7% compared with 0.4% for center cities on an annualized basis⁵
A material shortage of housing options in gateway and coastal markets that have strong exposure to DIGITAL drivers
An increasing shift towards emerging growth markets that offer material advantages in cost and greater flexibility in housing options
A substantial shortage of affordable housing catering to middle-income and workforce households
A broadening of housing needs away from traditional multifamily into more bespoke or individualized solutions including single-family rentals, manufactured housing, and senior living communities

In analyzing these trends, we believe that the investment opportunity set will be diverse but particularly attractive in (a) high growth demographic markets and (b) markets with strong DIGITAL drivers coupled with challenged affordability metrics. As such, we identify an initial list of target markets that meet some of the investment criteria identified (Exhibit 4).

Exhibit 4: Population growth and housing affordability

Scatter plot showing the relationship between population growth and housing affordability in the U.S. in 2021

U.S. Census Bureau, Moody's Analytics, Principal Real Estate Investors, Q4 2021

*A value of 100 means that a family with the median income has exactly enough income to qualify for a typical mortgage on a median-priced single-family home. An index above 100 signifies that the family has surplus income.

CASE STUDY: Raleigh presents an ideal DIGITAL opportunity

Raleigh is a prime example of a market that offers considerable residential investment opportunities and ticks several of our DIGITAL conviction boxes. A set of key demographic indicators supports Raleigh’s outperformance relative to the U.S. through 2025:

Raleigh's population is projected to grow by 7%, outperforming the U.S. population growth of 2%⁶
Raleigh's white-collar employment is expected to grow by 6%, outpacing the 4% growth of the U.S.⁶
Raleigh's household formation will increase by 11%, exceeding that of the U.S. by 7%⁶
Raleigh's apartment total returns on an annual basis have averaged 12.1% over the past five years, outperforming the national average by 375 basis points⁷

The demographic tailwinds along with Raleigh’s strong employment outlook makes it a highly desirable and affordable residential market where we expect investment opportunities to be available. Markets such as Raleigh epitomize the DIGITAL strategy we believe can lead to attractive investment opportunities across multiple property types, particularly residential.

Monthly rent to income ratio, %

Moody's Analytics, REIS, U.S. Census Bureau, Principal Real Estate Investors, Q4 2021

Case study is shown for illustrative purposes only and not intended to forecast or predict future events. It does not reflect the actual or expected returns of any portfolio or strategy and does not guarantee future results.

Supply/demand imbalances have set up a large and growing opportunity

Supply has not kept pace with the growth of, and shifts in, U.S. housing demand, thereby creating sizeable development opportunities (Exhibit 5). According to Freddie Mac, the U.S. is undersupplied by 2.5 million units, a number which is likely to grow as the pace of household formation recovers from the pandemic and an increasing number of generation Z renters enter the market. Moreover, COVID-19 has slowed new construction, and with current available supply concentrated in more expensive luxury units, affordable rentals are at a premium.

Exhibit 5: A lack of housing construction over the past decade has led to shortages
Housing starts and household formation
Index (Q1 2000 = 100)

Chart showing housing construction trends from 2000 to 2024 (forecasted) by single and multifamily households

U.S. Census Bureau, Moody's Analytics, Principal Real Estate Investors, Q1 2022

Residential opportunities look most attractive for development strategies

The large and growing residential opportunity set continues to attract investors making this a very liquid property type. In 2021, the residential sector saw $332 billion in transactions, a 121% increase from 2020.⁸ The result has been to push pricing metrics for stabilized residential assets; as a result, cap rates have reached record lows in some markets. It is clear to us that structural and COVID-induced shifts in the U.S. residential market make it a very attractive property sector over the foreseeable future. Given pricing levels for core, stabilized assets, and the imbalance between supply and demand, we believe development strategies may offer the best risk-adjusted returns and may also generate higher total returns. Development should offer investors the ability to capture yields in excess of stabilized cap rates, particularly in an environment where inflation and bond yields may be pushed higher and sell into the very liquid investor appetite for high-quality residential assets. Development strategies continue to offer attractive absolute and relative returns: Principal Real Estate Investors estimates relatively robust internal rates of return (IRRs) in the range of 15%-20% providing the highest spread over core and value-add levels in more than three decades. If bond yields move higher, the differential could be even greater. (Exhibit 6).

Exhibit 6: Development should outperform other strategies
Forecast internal rates of return (IRRs)**

Bar chart showing forecasted internal rates of returns in core, value-add, and development real estate segments

Principal Real Estate Investors, Q1 2022

**Estimated gross unlevered total returns (IRR) as of 31 December 2021 and are before fees, transaction costs and other expenses. These are projections given current business plans, expectations and market conditions that Principal Real Estate Investors has observed on the market generally. There is no guarantee that an investor will achieve these projected internal rates of return on any similar properties or real estate asset classes in the future. Projected performance is not a reliable indicator of future performance and should not be relied upon as a significant basis for an investment decision. You should consider whether an investment fits your investment objectives, particular needs and financial situation before making any investment decision.

We believe development strategies not only offer potentially attractive investment performance relative to core assets but, as importantly, offer other material benefits to investors and occupiers:

For investors, merchant-building in the residential sector may be an effective way to add a hedge for inflation by (1) bringing units to market with amenities that are better suited to capture inflationary trends in lease-up phase and, (2) provide potential protection from material and labor cost increases which can be passed through on to stabilized values.
The ability to address and tailor specific ESGrelated occupier needs—whether it is the requirement for more energy-efficient appliances or for more open space and wellness facilities. Middle-income housing could be an important contributor to an overall ESG strategy and solve for very strong occupier demand.
Provide the nimbleness to pivot towards housing formats most suited to a market's needs. This flexibility facilitates a highly targeted approach to maximizing investment outcomes.

CONCLUSION: Structural shifts make housing a compelling development opportunity

The U.S. housing market is poised for a substantial uptick in demand as the demographic shape of society intersects with COVID-19 induced shifts. Markets with lower costs of living, higher educated workforces, and exposure to some of the DIGITAL drivers are poised for strong household formation and housing demand.

We believe development strategies may offer investors an attractive, risk-adjusted opportunity to harness the potential in this sector and not only provide the potential for excess returns, but also tailored solutions to meet the expanding breadth of evolving ESG and tenant needs.

¹ DIGITAL refers to key long -term growth drivers centered around demographics, innovation, globalization, infrastructure, and technology that Principal has identified as metrics of long-term market outperformance.
² https://www.census.gov/data/datasets/2017/demo/popproj/2017-popproj.html
³ U.S. Census Bureau, Historical Living Arrangements of Adults, https://www.census.gov/data/tables/time-series/demo/families/adults.html, November 2021.
⁴ According to calculations by Principal Real Estate Investors from the Current Population Survey's Annual Social and Economic Supplement (ASEC), as of March 2021. Data obtained from IPUMS-CPS, University of Minnesota, www.ipums.org.
⁵ Based on Principal Real Estate Investors’ analysis of U.S. Census data from the March Annual Social and Economic Supplement for metropolitan areas with populations above 1 million persons. Data are from IPUMS-CPS, University of Minnesota, www.ipums.org.
⁶ Moody's Analytics, U.S. Census Bureau, Bureau of Labor Statistics, Principal Real Estate Investors, Q4 2021.
⁷ NCREIF NPI, Principal Real Estate Investors, Q4 2021.
⁸ Based on data from Real Capital Analytics on transactions valued at $5 billion and above through the end of 2021, including apartments, seniors housing, student housing, manufactured housing. Principal Real Estate Investors calculations, February 2022.

Environmental, social, and governance (ESG) responsible investing is qualitative and subjective by nature, and there is not guarantee that the criteria utilized, or judgment exercised, will reflect the beliefs or values of any one investor. ESG criteria may present additional advantages or risks and does not protect against market risks or volatility. There is no assurance that the socially responsible investing strategy and techniques employed will be successful.

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All products or services provided to you by any Principal Financial Group company shall only be available in the jurisdiction(s) within which the company providing the product or service is authorized to operate. The relevant Principal Financial Group company reserves the right to make the final determination on whether or not you are eligible for any particular product or service. If you choose to enter a website outside your country of residence, you are advised that it may not be legal in that jurisdiction for you to access or use the facilities available on that Site and the legal requirements of that jurisdiction may prohibit you from dealing or otherwise transacting in that jurisdiction.

Principal Financial Group makes no representation that the content of the site is appropriate for use in all locations, or that the transactions, securities, products, instruments or services discussed at this site are available or appropriate for sale or use in all jurisdictions or countries, or by all persons and entities. Nothing on this website shall be considered a solicitation for the offering of any investment product or service to any person in any jurisdiction where such solicitation or offering may not lawfully be made.

You may view, download for caching purposes only, and print content from the website for your own personal use, subject to the restrictions set out below and elsewhere in these Terms of Use.

No Guarantee of Timeliness
This website may contain videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions. The information and materials contained on this website, and the terms, conditions, and descriptions that appear, are subject to change. All content on this website is presented only as of the date published or indicated, and may be superseded by subsequent market events or for other reasons. In addition, you are responsible for setting the cache settings on your browser to ensure you are receiving the most recent data.

No Warranties
The information on this website has been developed internally and/or obtained from sources believed to be reliable; however Principal Global Investors and its affiliates do not independently verify or guarantee its accuracy or validity. The information and services provided on this website are provided ""AS IS"" and without warranties of any kind, either expressed or implied. To the fullest extent permissible pursuant to applicable law, Principal Global Investors disclaims all warranties, including, but not limited to, any warranty of non-infringement of third-party rights and any implied warranties of merchantability and fitness for a particular purpose. Principal Global Investors does not warrant, either expressly or impliedly, the accuracy or completeness of the information, text, graphics, links or other items contained on this website and does not warrant that the functions contained in this website will be uninterrupted or error-free, that defects will be corrected, or that the website will be free of viruses or other harmful components. Principal Global Investors expressly disclaims all liability for errors and omissions in the materials on this website and for the use or interpretation by others of information contained on the website. Subject to any contrary provisions of applicable law, no company in the Principal Financial Group nor any of their employees or directors gives any warranty of reliability or accuracy nor accepts any responsibility arising in any other way (including by reason of negligence) for errors or omissions on this website.

If you have questions, please email us.

Click ""Accept"" to indicate your acknowledgement and acceptance of Principal Global Investors Terms of Use and to continue."

"These Terms & Conditions explain certain legal and regulatory conditions and restrictions in relation to the Principal Global Investors (Europe) Limited website, and in relation to the Principal Global Investors Funds (‘the Funds’). This information may be changed by Principal Global Investors at any time without notice.

In these terms and conditions, references to 'Principal Global Investors' means Principal Global Investors (Europe) Limited or any affiliate of the Principal Financial Group, Inc. or Principal Global Investors, LLC.

Before you proceed, you must acknowledge that you have read, and agree to, our terms and conditions.

Information in relation to the Principal Global Investors Funds is available through this web site to institutional investors resident in the following countries of: Belgium, France, Finland, Germany, Guernsey, Ireland, Italy, Jersey, Netherlands, Spain, Sweden, Switzerland and the United Kingdom. By proceeding this far you are representing and warranting that you are an institutional investor resident in one of these countries. Not all of the Funds are available in all these jurisdictions, and investors are directed to the Country Registration document for detailed information . What follows is not an offer or invitation to acquire an investment to, and should therefore not be relied upon by, any person anywhere other than the countries noted. Persons in respect of whom such prohibitions apply must not access this web site. This web site is reserved exclusively for non-U.S. persons and should not be accessed by any person in the United States.

Yes, I certify to be an institutional investor and resident of a country listed above.

Cookies
Use of cookies on this site is outlined in the Privacy and Security Policy. In accepting these terms and conditions, you accept the terms of the Cookie Policy and the use of cookies from this site.

Legal Entity Disclosure and Regulation
In Europe by Principal Global Investors (EU) Limited, Sobo Works, Windmill Lane, Dublin D02 K156, Ireland. Principal Global Investors (EU) Limited is regulated by the Central Bank of Ireland.

In the United Kingdom by Principal Global Investors (Europe) Limited, Level 1, 1 Wood Street, London, EC2V 7 JB, registered in England, No. 03819986, which is authorised and regulated by the Financial Conduct Authority (“FCA”).

In Switzerland by Principal Global Investors (Switzerland) GmbH. This website is considered as advertising and information contained herewith be treated as such. Investors can obtain free of charge the prospectus, trust deed, the prospectus, the key investor information document (KIID), and the annual and semi-annual reports from the representative in Switzerland.

In Europe and United Kingdom, this website is directed exclusively at Professional Clients and Eligible Counterparties and should not be relied upon by Retail Clients (all as defined by the MiFID and FCA respectively). If you are viewing the material as a retail investor, you should seek independent investment advice before deciding whether the products and services in question are suitable to meet your investment needs and objectives, as the language has not been complied to a retail client standard.

Principal Global Investors Funds
Principal Global Investors (Ireland) Limited is the issuer of the Funds. Investments may only be made on an application form attached to a current prospectus and following receipt by the investor of the KIID in respect of the Fund in which they intend to invest. The latest version of the prospectus of the Funds is dated 14 December 2012.

For Real estate investors in the European Economic Area (“EEA”), this website and the information on it is only directed at persons who are professional investors for the purposes of the Alternative Investment Fund Managers Directive (2011/61/EU) (“AIFMD”), professional clients or eligible counterparties for the purposes of the Markets in Financial Instruments Directive (Directive 2014/65/EU) (“MiFID II”) or as otherwise defined under applicable local law and regulation and at whom this website and the information on it may lawfully be directed in any relevant jurisdiction (“Eligible Persons”). In relation to each member state of the EEA (“Member State”) which has implemented AIFMD (and for which transitional arrangements are not/ no longer available), this website may only be accessed and interests in Funds may only be offered or placed in a Member State to the extent that: (i) the relevant Fund is permitted to be marketed to professional investors in the relevant Member State in accordance with AIFMD (as implemented into the local law/regulation of the relevant Member State); or (ii) this website and its information may otherwise be lawfully distributed and the interests in Funds may otherwise be lawfully offered or placed in that Member State (including at the initiative of the investor). In relation to each Member State of the EEA which, at the date of accessing this website, has not implemented AIFMD, this information may only be distributed and interests in Funds may only be offered or placed to the extent that this information may be lawfully distributed and the interests in Funds may lawfully be offered or placed in that Member State (including at the initiative of the investor).

Persons who are not Eligible Persons, including but not limited to those individuals or other persons who fall within the FCA’s definition of ‘retail clients’, should not use or rely upon this website or the information contained therein and may not engage the services of Principal Real Estate or any of its affiliates, or invest in any Fund. Potential investors are advised that all or most of the protections provided by the UK regulatory system will not apply and that the UK Financial Services Compensation Scheme may not be available in relation to an investment in a Fund or separate account.

The contents of this website have not been verified or approved by any competent regulatory or supervisory authority. No liability, whether in negligence or otherwise, arising directly or indirectly from the use of the information or any part of it on this website is accepted and no representation, warranty or undertaking, whether express or implied, is or will be made at any time by Principal Real Estate or its affiliates or any of their respective advisers, directors, officers, employees, representatives or other agents (“Principal Agents”) for any information or any of the opinions contained herein or for any errors, omissions or misstatements.

None of Principal Real Estate or its affiliates or any Principal Agents makes or has been authorised to make any representation or warranties, whether express or implied, in relation to Principal Real Estate or regarding the truth, accuracy or completeness of any of the information contained on this website at any time. No representation or warranty is given by Principal Real Estate, its affiliates or the Principal Agents as to the achievement or reasonableness of, and no reliance should be placed on any projections, targets, estimates or forecasts contained in the information on this website. Furthermore, nothing contained on this website is or should be relied on as a promise or representation as to the future. No reliance may be placed by any person for any purpose whatsoever on the information or opinions contained on this website or on its completeness, accuracy or fairness at any time.

Principal Global Investors (Europe) Limited is not authorised by the FCA to directly deal with retail investors; any distribution of the Fund to retail investors in Europe is facilitated by fund distributors with which Principal Global Investors (Europe) Limited has entered distribution arrangements, pursuant to advice provided to investors by those distributors, based on the documents Principal Global Investors (Europe) Limited provides. Retail investors should not be provided with access to this website.

The name of the Swiss representative is ACOLIN Fund Services AG, Stadelhoferstrasse 18, CH-8001 Zürich. The name of the Swiss paying agent is Banque Cantonale de Genève, 17, quai de l’Ile, 1204 Geneva. Investors can obtain the prospectus, trust deed, the simplified prospectuses and the annual and semi-annual reports free of charge from the representative in Switzerland.
The value of units and the income from them may fall as well as rise.

Investments in the Funds are neither insured nor guaranteed by the US Government or the Federal Deposit Insurance Corporation and are not deposits or obligations of, or guaranteed by, Principal Global Investors.

No Solicitation
Nothing contained in this website shall constitute an offer or solicitation, in relation to units in the Funds or generally, in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or not authorised.

In particular, shares issued by the Company, and units in the Funds, have not been and will not be registered under the United States Securities Act of 1933 as amended or the securities laws of any state or political subdivision of the United States and may not, except in a transaction which does not violate US securities laws, be directly offered or sold in the United States or to any US Person. The Company will not be registered under the United States Investment Company Act of 1940 as amended.

This website is reserved exclusively for non-US persons and should not be accessed by any person in the United States.

No Investment Advice
The information in this website contains general information only on investment matters and should not be considered as a comprehensive statement on any matter and should not be relied upon as such nor should it be construed as specific investment advice, an opinion or recommendation. The general information it contains does not take account of any investor’s investment objectives, particular needs or financial situation, nor should it be relied upon in any way as a forecast or guarantee of future events regarding a particular investment or the markets in general. Past performance is not a reliable indicator of future performance and should not be relied upon as a significant basis for an investment decision.

You should also inform yourself as to (a) the possible tax consequences, (b) the legal requirements and (c) any foreign exchange restrictions or exchange control requirements which you might encounter under the laws of the countries of your citizenship, residence or domicile and which might be relevant to any investment, including the subscription, holding, transfer or disposal of units in the Funds

Delegation of Investment Management to Affiliates

Products upon which composite results contained in this material, if any, are based may not themselves be available in the United Kingdom and certain other jurisdictions; however, the underlying investment management capability can be made available to institutional investors subject to all applicable local regulations and restrictions. In connection with its management of client portfolios, PGIE may delegate management authority to affiliates that are not authorised and regulated by the Financial Conduct Authority. In any such case, the client may not benefit from all protections afforded by rules and regulations enacted under the Financial Services and Markets Act 2000.

Disclaimer
The information on this website is given by Principal Global Investors in good faith and has been derived from sources believed to be reliable and accurate as at their date. However, Principal Global Investors makes no representation or warranty of any kind for the accuracy or completeness of the information and it is under no obligation to update or correct any errors in the information after the date of publication. This website also contains videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions.

Subject to applicable law, Principal Global Investors and its affiliates and their respective directors, employees and associates do not accept any responsibility arising in any way (including by reason of negligence) for errors in, or omissions from, the information and do not accept any liability for any loss or damage, however caused, as a result of any person relying on any information on the website or being unable to access the website.

The Internet is not a totally reliable and secure medium of communication. Principal Global Investors accepts no liability for the security or confidentiality of information transmitted in this way and any such transmission of information shall be at your own risk.

The entire content of this website is subject to copyright with all rights reserved. You may not copy, reproduce, distribute or modify the content of this website without the prior written permission of Principal Global Investors.

No instructions for investment purposes will be accepted directly from this website or by e-mail.

If you accept these terms and conditions, click ""Accept."""

You are about to leave PrincipalAM.com and be directed to our Japanese site, PrincipalGlobal.jp. If you wish to proceed, please click "Accept." If you would like to stay on PrincipalAM.com, please click "I do not accept."

You may view, download for caching purposes only, and print content from the website for your own personal use, subject to the restrictions set out below and elsewhere in these Terms of Use.

No Guarantee of Timeliness
This website may contain videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions. The information and materials contained on this website, and the terms, conditions, and descriptions that appear, are subject to change. All content on this website is presented only as of the date published or indicated, and may be superseded by subsequent market events or for other reasons. In addition, you are responsible for setting the cache settings on your browser to ensure you are receiving the most recent data.

No Warranties
The information on this website has been developed internally and/or obtained from sources believed to be reliable; however Principal Global Investors and its affiliates do not independently verify or guarantee its accuracy or validity. The information and services provided on this website are provided ""AS IS"" and without warranties of any kind, either expressed or implied. To the fullest extent permissible pursuant to applicable law, Principal Global Investors disclaims all warranties, including, but not limited to, any warranty of non-infringement of third-party rights and any implied warranties of merchantability and fitness for a particular purpose. Principal Global Investors does not warrant, either expressly or impliedly, the accuracy or completeness of the information, text, graphics, links or other items contained on this website and does not warrant that the functions contained in this website will be uninterrupted or error-free, that defects will be corrected, or that the website will be free of viruses or other harmful components. Principal Global Investors expressly disclaims all liability for errors and omissions in the materials on this website and for the use or interpretation by others of information contained on the website. Subject to any contrary provisions of applicable law, no company in the Principal Financial Group nor any of their employees or directors gives any warranty of reliability or accuracy nor accepts any responsibility arising in any other way (including by reason of negligence) for errors or omissions on this website.

If you have questions, please email us.

Click ""Accept"" to indicate your acknowledgement and acceptance of Principal Global Investors Terms of Use and to continue."

"Principal Global Investors, LLC, the issuer of this website, is a branch registered in the Dubai International Financial Centre and is authorized by the Dubai Financial Services Authority as a representative office.

This website contains general information only on investment matters and nothing in this website is intended to constitute or form part of any offer or inducement to issue or sell, or any solicitation of any offer to subscribe for or purchase, any securities or investment products in the UAE (including the Dubai International Financial Centre) and accordingly should not be construed as such. Information in this website is not directed at you if we are prohibited by any law of any jurisdiction from making the information on this site available to you and is not intended for any use that would be contrary to local law or regulation. Products or services mentioned on this site are subject to legal and regulatory requirements in applicable jurisdictions and may not be available in all jurisdictions. Accordingly persons are required to inform themselves of and observe any such restrictions.

The information in this website is being made available on the basis that the recipient acknowledges and understands that the entities and securities to which it may relate have not been approved, licensed by or registered with the UAE Central Bank, the Dubai Financial Services Authority or any other relevant licensing authority or governmental agency in the UAE or elsewhere in the Middle East.

The information in the following website should not be construed as investment advice or a recommendation for the purchase or sale of any security. The value of investments and the income from them may fall as well as rise. Principal Global Investors, LLC and the other member firms of Principal Global Investors (collectively, the ""Firms"")* do not guarantee any investment results and there can be no assurance that the strategies employed will improve investment performance, and make no guarantee that a client's investment objectives will be achieved and no warranties or representations, expressed or implied, are made by the Firms concerning the benefits of these strategies discussed herein. The information in this website has been developed internally and/or obtained from sources that the Firms believe to be reliable; however, the Firms do not guarantee the accuracy, adequacy or completeness of such information and are not responsible for any errors or omissions. This website also contains videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions.

This website contains general information only on investment matters and should not be considered as a comprehensive statement on any matter and should not be relied upon as such. The information it contains does not take account of any investor's investment objectives, particular needs or financial situation. Past performance is not a reliable indicator of future performance and should not be relied upon as a significant basis for an investment decision. You should consider whether an investment fits your investment objectives, particular needs and financial situation before making any investment decision.

Nothing in this website should be construed as investment, tax, legal or other advice.

The content of this website has not been approved by or filed with the UAE Central Bank or Dubai Financial Services Authority.

Access to this website is only permitted for ""sophisticated institutional investors/professional clients"". If you are not a ""sophisticated institutional investor/professional client"", you may not access this website and you should select the ""Decline"" link below.

By selecting the ""Accept"" button below, and entering this website, you agree to these terms and confirm and represent that you are a "" sophisticated institutional investor/professional client""."