Brooks Macdonald Funds (BMF) is to launch the IFSL North Row Liquid Property Fund, believed to be the UK’s first actively-managed UCITS core property fund.
The fund is expected to launch in February and will be managed by Steven Grahame, who developed the original concept for the fund, supported by Dr Niall O’Connor as deputy fund manager.
The IFSL North Row Liquid Property Fund will offer investors liquid exposure to the global real estate markets by investing mainly in property derivatives, as well as property equity and debt, to gain exposure to direct property markets. The open-ended fund will aim to deliver a high correlation to direct property markets, targeting a high income yield of 4.5 per cent to 5.5 per cent with low volatility.
To enhance total returns, the fund will be actively managed using a fundamental and quantitative research process to identify mis-valued markets, identifying mis-valuations between property debt, equity and direct markets, while measuring and controlling risk via BMF’s own risk management process.
The fund has daily dealing, no performance fee, no entry/exit fee and has a significantly lower total expense ratio than directly invested funds available on the market. The minimum initial investment will be GBP10,000.
Simon Wombwell, CEO of Brooks Macdonald Funds, says: “The IFSL North Row Liquid Property Fund is a unique and innovative concept which we are excited to be bringing to investors. It is the first UCITS property fund of its kind, and offers a unique opportunity to invest in property through assets with daily liquidity, rather than slower-moving bricks and mortar.”
Grahame says: “Today’s improving economy provides a positive outlook for property, which we believe should be at the top of investors’ wish lists for 2014 – given its ability to provide income and compelling relative value.
“Our approach in identifying relative value across property asset classes allows us to actively manage whilst avoiding the costs and delays in transacting physical property. We believe professional investors have long wanted an efficient way of managing their exposure to property. As the first UCITS core property fund our launch couldn’t be better timed.”