APNto list flexible property fund
APN Funds Management is to list its Property for Income Fund on the Austock exempt market this month following the poaching of a number of key Colonial First State property executives.
APN Funds Management is to list its Property for Income Fund on the Austock exempt market this month following the poaching of a number of key Colonial First State property executives.
APN executive director Howard Brenchley says listing the fund will create more liquidity for the fund.
“We have decided to list as an option for those investors who circumstances have changed and who need to sell their units,” he says.
The move comes as APN boosts its management team with the arrival of Colonial First State’s former key property executives. Andrew Bird has joined APN as managing director, while Rick Hart will form a new wholesale division. David McCormack has joined as an analyst.
The former Colonial team defected after First State decided to move the property side of the fund management business to Sydney.
Brenchley says APN is looking to set up a direct wholesale fund in the future, investing in single major property assets.
“We intend to go to the quality end of the market with a single building syndication that will appeal to the wholesale market,” he says. The fund would also be sector-specific.
“With the arrival of the former First State team, it will give us the opportunity to do some different things and the opportunity to be creative,” Brenchley says.
The APN Property for Income Fund returned 7.93 per cent last year with a retail MER of 1.25 per cent. Brenchley says this strong results compares dramatically with the ASX listed property trust index for the same period, which retreated nearly 5 per cent.
Brenchley says property markets are coming to a turning point, with the LPT sector running out of steam and concerns arising over some syndicates.
“The questions that are being asked of syndications concern the quality of the management in some trusts, together with the quality of property and the gearing levels,” he says.
“Risk levels in some syndicates will cause their downfall as the gearing levels are too high.”
Brenchley argues that good-quality, single asset syndicates with sensible gearing will eliminate risks and provide more growth for investors.
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