For years my co-managers have laughed at my obsession with lifts. One of my favourites is in the Bulgarian Central Bank building.
It has a spectacular, ever-rotating mechanism of rising platforms onto which you jump when they pass. No safety doors but one great adrenaline rush - and, given how cheap budget airline tickets are, better value than a day at Alton Towers, outside lockdown.
My unusual passion has taken me far beyond Bulgaria. One memorable trip in Japan was to meet the management at Fujitec, based in Hikone, over 200 road miles from Tokyo. It was quite a trek for a 90-minute meeting, but worth it for everything I learned about the industry and its potential for investors.
This is a sector dominated by only four companies: Fujitec, Kone, Otis and Schindler. Though they often make little money on installation, these companies enjoy strong, recurring income from maintenance - lifts are generally expensive to replace, so landlords prefer to maintain their existing systems. The lack of competition in the market allows the key companies to charge high prices for parts and regular servicing.
In recent weeks there has been much comment on which businesses win or lose from the pandemic. Tech firms that support home working and health sector companies have seen their share prices soar. But there are other businesses, less well known, that look set to prosper. I would include lift companies - beneficiaries of what you might call a ‘safer planet' impulse.
Corporations need to make their workspaces safer. While some people thrive working from home, many companies are struggling to maintain an appropriate dynamic and will erode their social capital if employees do not return to work soon. Managements want to see people back together again, swapping ideas over the water cooler. Governments want to see life back in city centres, too.
Lifts are a source of contamination. Elevators are small, enclosed spaces by nature, and they tend to lack a strong airflow. Though it is less common for it to spread through surface contact, the virus has been seen to linger on lift buttons. In July a report claimed that one woman in China, returning home to quarantine, passed coronavirus to an estimated 71 people through the single lift journey up to her apartment.
Kone is one company reducing the threat with technology. The Kone Remote Call app allows you to call for a lift using your phone, reducing contact with shared surfaces. Innovations like this may increase the safety of homes and commercial buildings, and property owners are under pressure to invest in them.
We are also seeing another ‘safer planet' impulse - the drive by governments to incorporate a green agenda within their plans for economic recovery. They are offering a ‘stick-and-carrot' approach to problems - setting tighter regulatory requirements, but giving subsidies to help. This is also assisting lift companies.
France has the oldest fleet of elevators in the world - fin de siècle pieces of rattling wrought iron, quaint but noisy and not energy-efficient. Edith Piaf is credited with saying: "When you reach the top, you should remember to send the elevator back down for the others." While this is usually interpreted in a figurative sense, it is a genuine part of etiquette when using outdated elevators. Forget to close the gate behind you, and the poor soul stranded on the ground floor cannot summon the lift back down - an inconvenience for a tired resident hauling bags of groceries home, not to mention a serious problem for anyone requiring disabled access.
Considering the EU's goal to reach net-zero carbon emissions by 2050, replacing these antiques with more efficient lifts that are also fitted with anti-coronavirus measures is a ‘win-win' solution. Safer people, safer planet.
The aim set out in the EU's Green Deal is to double the annual rate of renovating existing buildings in order to reach 2030's targets. Buildings account for 40% of all energy consumed, according to Eurostat. If Biden beats Trump in the upcoming election, then we would expect him practically to copy and paste the EU's Green Deal and apply the same focus on renovation throughout the US.
The elevator industry is only one beneficiary. Another is heating, ventilation and air-conditioning (HVAC).
One person with the virus can contaminate a whole building if it is fitted with an outdated air-conditioning system that merely recycles air without filtering it. I once worked in an office block that had to be evacuated for an entire week when a single person contracted meningitis - the contagious virus was circulating around the building through the air-con vents.
Across the globe we are seeing a drive for cleaner - and more efficient - air-con units in buildings. That means replacing or updating existing systems. And that means plenty of work for HVAC companies we hold like Trane and Daikin, one American and one Japanese.
There is much talk of a tech bubble. Some fund managers say investors should be selling the tech giants that have led the S&P's recovery; and recycling the money into heavily discounted value stocks whose ‘day in the sun' is well overdue. We are always watchful on valuations and have taken profits on some of the tech stocks we did hold. But the examples I have given show that there are still plenty of interesting opportunities for growth in the world - without having to take a chance on ‘bargain-bucket' stocks in industries pummelled by the pandemic.
Rosanna Burcheri is co-manager of the Artemis Global Select fund and the Mid Wynd International investment trust.