Investments · Real Assets
REITs, Commodities & Real Assets for International Portfolios
Real assets — REITs, gold, infrastructure, and commodities — provide inflation hedging, income generation, and low correlation to conventional equity and bond markets. For internationally mobile investors, they also offer exposure to physical value that transcends any single currency or jurisdiction.
Asset classes
Six Real Asset Categories for International Portfolios
Real assets span a broad spectrum from exchange-listed REITs with daily liquidity to illiquid farmland. Each has distinct yield, liquidity, and inflation-linkage characteristics.
REITs
Diversified real estate exposure via listed companies. Sectors include commercial, residential, industrial/logistics, healthcare, and data centres. Daily liquidity at equity-market prices.
Income: 3–6% dividend yield typical
SEGRO, LandSec (UK); Prologis, Realty Income (US); CapitaLand, Mapletree (Singapore)
Gold & Precious Metals
The original store of value. No counterparty risk when held physically. Acts as portfolio insurance during currency crises, geopolitical events, and periods of negative real interest rates.
Income: No income. Return = price appreciation only
iShares Physical Gold ETC, SPDR Gold Shares, allocated custody at recognised vaults
Commodities (Broad)
Oil (WTI/Brent), natural gas, agricultural commodities, base metals. Diversification from financial assets; historically low correlation to equities in aggregate.
Income: Futures roll yield + spot return
iShares Diversified Commodity Swap ETF, WisdomTree Broad Commodities
Listed Infrastructure
Essential assets with inflation-linked income streams. Toll roads, airports, utilities, renewable energy, social infrastructure. Long concession periods provide income visibility.
Income: 5–7% distribution yield typical
HICL Infrastructure, International Public Partnerships, 3i Infrastructure (UK listed)
Timber & Farmland
Biological growth provides a natural inflation hedge. Timberland returns have historically been low-correlation to equities. Farmland income is driven by food commodity prices and lease rates.
Income: 3–5% yield + capital appreciation
Via specialist real assets funds; limited listed vehicle options
Data Centres & Towers
The fastest-growing REIT sub-sector. Driven by cloud computing, AI demand, and 5G rollout. Higher growth potential than traditional real estate; valued on earnings multiples not just yield.
Income: 1–3% yield (lower — growth-oriented)
Equinix, Digital Realty, American Tower, Crown Castle
Deep dive
Global REIT Markets: US, UK, Singapore & Australia
US REITs — the World's Deepest Market
The US is home to the world's largest REIT market, with over 200 publicly traded REITs across every property sector — from residential and retail through to healthcare (WELL Health, Ventas), data centres (Equinix, Digital Realty), and industrial logistics (Prologis). The Vanguard Real Estate ETF (VNQ) provides diversified exposure at very low cost.
Non-US investors should be aware that US REIT dividends are typically subject to 30% withholding tax (15% under most tax treaties). This drag can be mitigated by treaty reclaims or by holding US REITs within a tax-efficient offshore wrapper.
Singapore REITs (S-REITs) — Asia's Model Market
Singapore has developed one of the world's most sophisticated REIT markets, with over 40 listed S-REITs covering Singapore, Malaysia, China, Australia, and Europe. S-REITs are known for strong corporate governance, transparent distributions, and yields typically in the 5-7% range.
Singapore imposes no withholding tax on REIT distributions to non-Singapore tax residents in many circumstances, making S-REITs particularly tax-efficient for internationally mobile investors based in low-tax jurisdictions. This is a meaningful advantage over US and UK REIT markets.
Safe haven
Gold as an International Reserve Asset
Gold has maintained purchasing power over millennia and remains the world's pre-eminent store of value outside the financial system. Its key portfolio characteristics for international investors are: near-zero correlation to equities during financial crises; inverse correlation to the USD in many environments; no counterparty risk when held physically; and broad cultural acceptance as a store of value across the Middle East, Asia, and beyond.
Central bank gold demand reached record levels in 2022-2024 as emerging market central banks (China, India, Turkey, Saudi Arabia) diversified reserves away from USD-denominated assets. This structural demand underpins price regardless of retail investor sentiment.
Access Methods for International Investors
- Gold ETCs/ETFs: iShares Physical Gold ETC (SGLN), SPDR Gold Shares (GLD) — backed by physical gold held in vault. Lowest cost and most liquid approach.
- Allocated gold accounts: Metal account with a custodian bank — you own specific, segregated bars. Available in London (LBMA), Zurich, Singapore, and Dubai vaults.
- Gold mining shares: Amplified exposure to gold price via operational leverage; higher risk than direct gold.
- Gold CFDs/futures: Leveraged exposure; for active traders not long-term holders.
Allocation framework
Building a Real Assets Sleeve
For a balanced international portfolio, a real assets sleeve of 15–25% provides meaningful inflation hedging and diversification without sacrificing too much growth potential. A typical allocation might include:
8–12%
Global REITs
Via diversified REIT ETF — US, UK, Asia weighting
5–8%
Gold
Physical-backed ETC or allocated account
4–7%
Infrastructure
Listed infrastructure funds — inflation-linked income
0–5%
Broad Commodities
Diversified commodity index ETF for cycle hedging
0–5%
Specialist REITs
Data centres, logistics, or healthcare REIT tilts
0–3%
Timber/Farmland
Via specialist fund for ultra-long-term allocations
Allocations are illustrative only. The appropriate real asset weighting depends on your currency exposures, tax situation, income needs, and overall portfolio composition. Speak to an adviser to determine the right balance for your circumstances.
Frequently Asked Questions
What is a REIT and how does it differ from direct property investment?
A Real Estate Investment Trust (REIT) is a listed company that owns income-producing real estate. Unlike direct property investment, REITs are traded on stock exchanges like shares — providing daily liquidity, no management responsibility, and access to diverse property types (offices, logistics, data centres, healthcare) at low minimums. UK REITs are required to distribute at least 90% of qualifying rental income to shareholders, making them yield-generating instruments. The trade-off is that REIT prices are correlated with equity markets, especially in volatile periods — less so than the direct property asset values they represent.
How is gold used in an international investment portfolio?
Gold is typically held as a 5-10% portfolio allocation for its inflation-hedging, geopolitical risk-hedging, and low/negative correlation to equities during crises. Gold produces no income (no dividend or coupon), so its return is entirely from price appreciation. It tends to perform well during periods of currency debasement, geopolitical uncertainty, and real interest rate declines. Access for international investors includes gold ETFs (such as iShares Physical Gold ETC), LBMA-traded gold spot, gold futures, and allocated gold storage accounts with custodians in stable jurisdictions.
How are REIT dividends taxed for international investors?
REIT dividends are typically subject to withholding tax in the jurisdiction where the REIT is listed. US REITs withhold 30% on dividends for non-US persons (15% under many tax treaties). UK REITs withhold 20% on Property Income Distributions (PIDs) by default. Many countries allow treaty reclaims. For internationally mobile investors, holding REITs within an offshore investment bond wrapper (Isle of Man, Dublin) can improve tax efficiency by deferring and potentially eliminating withholding tax drag, depending on jurisdiction of residence. Always obtain jurisdiction-specific tax advice.
What are infrastructure funds and why do they belong in a portfolio?
Infrastructure funds invest in essential physical assets — toll roads, airports, ports, utilities, renewable energy, telecommunications. Returns are typically linked to inflation (via RPI/CPI-linked concession agreements), long-dated (concession periods of 25-99 years), and less correlated to economic cycles than equities. Listed infrastructure funds in the UK (HICL Infrastructure, International Public Partnerships, BBGI) have historically provided dividend yields of 5-7% with inflation linkage, making them valuable for income-oriented international investors seeking real asset exposure without direct property management.
Add real assets to your international portfolio
We advise on REIT selection, gold custody, infrastructure fund access, and commodity allocation for internationally mobile investors. Understanding your currency exposure and tax jurisdiction is the starting point for efficient real asset portfolio construction.
The value of investments in REITs, commodities, and real assets can fall as well as rise. Dividend yields are not guaranteed. Tax treatment depends on individual circumstances and jurisdiction. Independent advice should be sought before investing.
Add real assets to your international portfolio
We advise on REIT selection, gold custody, infrastructure funds, and commodity allocation for internationally mobile investors. Speak to an adviser about building your real assets sleeve.