Hybrid property fund inflows jump 400 per cent in two years: MIA
Funds inflow to the hybrid property funds sector has grown by 400 per cent over the past two years to stand at a total of $6.06 billion in funds under administration (FUA) at December 31, last year, according to property investment research firm Managed Investment Assessments (MIA).
Director Anton Lawrence said the inflows had been primarily driven by demand for liquidity among direct property investors and also by the platform friendly investment structure offered by hybrid funds.
Lawrence was speaking at the launch of MIA’s annual hybrid property fund sector review, covering 11 fund managers, 13 rated funds and more than $6 billion in FUA. The managers included AXA, Australian Unity, BlackRock, Challenger, APN, AMP, Centro, Macquarie, Multiplex and Perpetual.
He also attributed the growing popularity of hybrid funds to the emergence of a new generation of hybrid funds offering investors a broader exposure to the property market, including unlisted property trusts and global property securities.
“Historically, hybrid funds, which emerged out of the liquidity concerns of investors hit by the 1990 property crash, aimed to maintain an asset allocation of 50 per cent to direct property and 50 per cent to listed property securities,” he said.
In addition, he said the new generation of hybrid funds are in some cases offering retail investors access to underlying investments that were previously only accessible to institutional investors.
The release of the hybrid funds report coincided with the launch of an expanded ratings and reports service across an expanded range of property investment products available to investors via the MIA annual subscription service.
It will offer investors the entire spectrum of hybrid property funds, unlisted trusts, global property securities funds, mortgage funds and domestic properties securities funds research.
Recommended for you
Platinum Asset Management has provided an update on the possibility of a merger with asset manager L1 Capital following a period of due diligence.
Commentators may be forecasting consolidation in private market firms but a survey of the industry itself expects new manager formation will still outpace this, especially in Asia Pacific.
Fund manager Pacific Current has appointed a former superannuation chief executive as its newest chair, succeeding Tony Robinson who departs after almost a decade to focus on his role at COG Financial.
The possibility of a private credit ETF is looking unlikely for now with US vehicles seeing limited uptake, according to commentators, but fixed income alternatives exist that can provide investors with a similar return.
