Jumping aboard the listed real estate bandwagon, Australian manager Perennial Investment Partners is adding a property fund to its group of boutique investments. The fund, which is aiming to raise millions in its first round, will invest in global listed property securities.
The business is to be run by Stephen Hayes who has enticed the entire property securities team away from Colonial First State to take up the challenge. Hayes was head of CFS's property outfit for eight years and brings with him five other portfolio managers, three of those based in Sydney and one each in London and New York.
Tuan Pham is the portfolio manager for Asian securities and will be based in Sydney while also working out of representative office in Hong Kong.
The business is to be owned 50% by Perennial and 50% by Hayes and three of his investment managers, tying their fortunes to the performance of the fund.
Anthony Patterson, Perennial's managing director, says the firm hopes to secure a small group of institutional investors either through mandates or pooled trusts in order to get the new fund off the ground. "After that, our focus will be on the sale of this fund through third party platforms."
"Our global capability will be marketed both domestically and internationally," he says. "We expect considerable interest from offshore institutions looking to participate in a professionally managed portfolio in the fast growing global REITS market."
The property fund will have two components: a domestic securities trust and a global securities trust. Patterson says Perennial will limit the size of the domestic trust.
Perennial was established in 1999 and now manages A$16 billion across five boutique funds.
Listed property trusts do very well in Australia. At the end of September last year the ASX's property index was up 16.51% with the funds returning an average dividend yield of 8% a year.