To merely say "these are challenging and complex times" seems an excessively simple comment for the size and multifaceted nature of the challenges ahead of us all. In this half-year review, I will try to summarize our views to help you navigate the way forward. As I write to you, the Corona virus has directly affected too many friends. Once you know someone who testifies how powerful and aggressive this virus can be, it makes you stop and reflect regardless of how many times you have read about it or heard of asymptomatic cases. One close family member or friend in hospital is infinitely more powerful than millions of nameless statistics from around the world. So, to all the readers who have had that direct impact, we share your anxiety and fear and send you all the strength we can.

It has been seven weeks since the start of Pesach and 11 weeks since most western world countries started the 100 case count. I have a screenshot on my phone from early March showing the worldwide case count at 200,000 with 8,000 deceased. As I write to you now, it is 5.5 million confirmed cases with 350,000 deceased, and that is with social distancing of varying degrees across most parts of the world. Can you imagine the virus numbers if we did not take any protective measures?

Renting a property without paying for it is no longer illegal. McDonald’s and Burger King in the UK are just two examples of a ‘blue chip’ tenant refusing to pay or looking to reduce their quarterly rent payments. 

Legal protection for commercial and residential tenants in a number of countries has already been enacted. Due to Covid-19, these tenants are not legally in breach of contract by not paying their rent for 6 months, even if they have the assets to do so. 

In other words - some of the most basic premises of investing in real estate no longer hold true. 

We hope this finds you safe and healthy and would like to wish you and your loved ones Happy Passover!

If you also speak Hebrew, we invite you to watch the recroding of the latest webinar we held, exactly about the topics in this review. The webinar included a review of the Israeli market in Hebrew and a review of the global markets in English.

2019 was a vindication year for the traditional asset management industry and asset allocators like us. Many skeptics sat on the sidelines in cash and missed the best year for returns we have had in a very long time. Our clients enjoyed excellent returns in both absolute and relative basis.

While 2017 was low positive and 2018 was negative, 2019 was very positive and brought the three-year returns comfortably into the annual targeted return range. This is the nature of the beast - market returns simply do not go in straight lines.

Our eyes now turn to 2020. As always, the crystal ball has its limitations and across our team we have slightly differing views for 2020. However, the consensus view is to remain faithful to our asset allocation principles.