Evergreen's 2020 Performance - Public Real Estate

Evergreen is proud to share its 2020 year-end performance for its two public equity strategies:

Evergreen Real Estate Income

Start Date: 7/2020

Annualized Income: 7.2%

2020 Total Return: 21.1%

Evergreen Real Estate Total Return

Start Date: 8/2020

Annualized Income: 3.8%

2020 Total Return: 11.7%

The income figures are annualized to demonstrate the cash flow component of each strategy. The total returns are not annualized, they are actual 2020 returns including cash dividends from their respective start dates. Past performance is no guarantee of future results.

Income Strategy Notes:

Our Evergreen income strategy is producing high income without sacrificing long-term appreciation. This is challenging in a zero-rate world, but our strategy is delivering on both fronts.

The portfolio outperformed by owning both common equity and preferred shares of publicly traded real estate companies. Our best investments last year were in several REIT preferred shares. These investments generated 20-35% returns over 6 months, despite their lower risk profile vs. common equity.

We were able to purchase such securities on sale due to the market’s reaction to COVID. While we certainly won’t make 20%+ every year, we expect to continue outperforming the vast majority of income strategies over rolling 5-year periods.

Total Return Strategy Notes:

Our total return strategy is geared to real estate / operating firms that we’d like to own forever (as long as they remain wonderful businesses). It’s primarily focused on firms executing on niche real estate strategies that compound capital. The secondary focus is on real estate service companies.

Unlike traditional real estate (office, retail, hotels, etc.) that are cyclical, have high turnover and require mountains of ongoing capital, we prefer unique business models with pricing power. For example, this portfolio is overweight REITs that supply the infrastructure to power the new economy: data centers, cell towers, lab space, cold storage, and last mile logistics. These sectors were not damaged by the crisis as they focus on mission critical facilities.

The total return portfolio is designed to capitalize on structural changes to real estate that we expect to play out over the next 10-20 years.

Evergreen investing

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