SEPUT Investors Vote for PAIF Conversion and SEPUT Outperforms
SEPUT will become the largest UK fund to date to convert to a Property Authorised Investment Fund (PAIF)*, a tax efficient UK fund structure authorised by the Financial Services Authority. This follows approval by investors to support the conversion of the fund, a major milestone. The conversion will open the fund to a broader investor base, including UK and overseas professional investors, for the first time. This should meet a growing demand for investment into high quality UK commercial property.
The conversion coincides with strong recent outperformance by the fund. Fund performance figures now available illustrate the success of repositioning SEPUT, since the credit crisis. As at 30 June 2012, the fund outperformed its benchmark (AREF / IPD UK Pooled Property Fund Indices – All Balanced Funds Median) over a rolling three year period with total returns of 11.2% p.a. versus 10.3% p.a. from the benchmark.
Ian Mason, SEPUT Fund Manager, commented:
“We see the conversion to a PAIF as a significant step forward for SEPUT. Existing investors will benefit from a UK fund structure authorised by the FSA. It will be authorised as a Qualified Investor Scheme (QIS), which means it will not only continue to be open to our existing investor base, but also other professional investors such as insurance groups, discretionary asset managers and overseas institutional investors.
We are grateful to our investors for their patience while we repositioned the portfolio. This has allowed the team to build a defensive portfolio with good quality property which today’s tenants want to occupy. The aim is now to ensure the rental income derived from the portfolio continues to be let to financially secure tenants and vacancy rates are kept low. This will help us to provide a secure and long income stream for our investors at an attractive yield relative to other asset classes.”
*Subject to FSA approval
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Schroder Exempt Property Unit Trust (SEPUT)
SEPUT is Schroder’s flagship UK core property fund, which was launched in 1971. It has £1.2 billion (30 June 2012) of diversified UK commercial property and its investors are mainly UK pension funds and charities. It is currently structured as an unauthorised exempt unit trust. Upon conversion to a PAIF, the fund will be renamed Schroder UK Property Fund (SPF).
Schroders has managed property funds since 1971 and has £10.2 billion (EUR 12.2 billion / US$ 16.3 billion) of gross property assets under management (at 31 March 2012) and has around 100 property staff located in 9 offices across the UK and Europe.
All of the property funds referred to are unauthorised collective investment schemes as defined in the Financial Services and Markets Act 2000. Promotion of these funds is restricted and access to full information about these funds is only available to those exempt from the restriction.
For further information about Schroders’ property business visit www.schroderproperty.com
Schroders is a global asset management company with £199.6 billion (€238.9 billion, $310.1 billion) under management as at 31 March, 2012. Our clients are major financial institutions including pension funds, banks and insurance companies, local and public authorities, governments, charities, high net worth individuals and retail investors.
Further information about Schroders can be found at www.schroders.com or on Schroders Talking Point www.schroders.com/talkingpoint.
Schroder Property Investment Management Limited and Schroder Investment Management Limited are authorised and regulated by the Financial Services Authority.
Issued by Schroder Property Investment Management Limited. Registration no. 1188240 England.