Listed investment markets continued to decline in the first two months of 2009, particularly in terms of the listed property market, which has fallen around 70% from its high in October 2007 (as per the S&P/ASX 300 A-REIT Accumulation Index). Investor sentiment towards unlisted markets, such as direct property, has also deteriorated.
The combination of these factors has caused the asset allocation of the AMP Capital Core Property Fund (the Fund) to shift markedly away from its 50/50 target allocation to direct/listed property. Currently, the Fund's allocation is 62% direct property and 38% listed property.
Introduction of quarterly withdrawal windows
In light of these extraordinary market conditions and the Fund's current asset allocation, AMP Capital has decided to introduce quarterly withdrawal windows, with immediate effect, to ensure withdrawing investors have equal access to available cash. This action has been taken in the best interests of all unitholders.
Investors in the fund will be mailed a letter shortly to provide an update on the changes. If you have clients invested through a platform we recommend that you speak to your platform provider to understand how these changes will be implemented.
In addition, we have provided a detailed Q&A plus a
fund update which outlines how the fund is performing and the future outlook for the fund and asset class.
Copy of materials
Fund and asset class update
Q&As regarding introduction of quarterly windows
Key points covered in the update include:
- The Fund's direct property investments are in high quality, well located properties with strong income streams from low risk tenants, both in Australia and overseas.
- More than three quarters of the direct assets (by value) in the portfolio have been re-valued since October last year. In addition the underlying funds, the AMP Capital Shopping Centre Fund and the AMP Capital Wholesale Office Fund, have moved from six monthly to a quarterly revaluation cycle.
- The Fund is not geared i.e. it has no debt at the Fund level, while the gearing at the
underlying funds level is approximately 13% overall.
- The Fund utilises the scale and experience of the broader AMP Capital group, with close
to 50 years of investing in and managing top grade property.
If you have any more questions, please do not hesitate to contact your Business Development
Manager or call our Adviser Services Team on 1300 139 267.
Head of Retail Distribution
Permanent Investment Management Limited (ABN 45 003
278 831, AFSL 235 150) (Permanent) is the responsible entity of the Core Property Fund
(Fund) and issuer of the units in the Fund and AMP Capital Investors Limited (ABN 59 001 777
591, AFSL 232 497) (AMP Capital) is the investment manager of the Fund. Permanent has not
prepared this document and makes no representation or warranty as to the accuracy or
completeness of any statement in it. To invest in the Fund, you and your clients will need
the Fund's current Product Disclosure Statement (PDS) issued by Permanent and available from
AMP Capital on its website. The PDS contains important information about investing in the
Fund and it's important you and your clients read the PDS before making a decision about
whether to acquire, continue to hold or dispose of units in the Fund. This information has
been prepared for the purpose of providing general information, without taking account of
any of your clients' objectives, financial situation or needs. You and your client should,
before making any investment decisions, consider the appropriateness of this information,
having regard to their objectives, financial situation and needs.