APN reopens flagship fund

APN Funds Management has reopened its flagship Property for Income Fund for new investors.

The fund closed in 2005 to ensure distributions to investors would not be impacted by lower yields from the listed property trust (LPT) sector.

APN head of investments Michael Doble said had the fund received significant inflows, it would have reduced income returns to existing investors.

But the fall in the LPT sector in the past six months has increased yields and Doble said he believes returns to existing investors can be enhanced by new inflows.

“The anticipated inflows will also provide greater flexibility to manage the overall portfolio and take advantages of current investment opportunities,” Doble said.

“The fund’s mandate has always been focused on having a lower risk profile than the LPT index to deliver sustainable and growing income returns for investors.

“Re-opening the fund will see that investment philosophy maintained.”

APN is going to broaden the investment mandate for the fund to maintain the low risk profile the fund enjoys.

The change will allow the fund to increase its exposure to international assets to reflect the change in the Australian LPT index.

However, international LPTs will only form 50 per cent of the index weighting instead of the 15 per cent portfolio-specific limit that was the previous benchmark. Doble said this allows the fund a greater choice of property securities while maintaining a lower risk profile than for the sector generally.

“This is a fantastic opportunity to invest in an established fund with a proven long-term investment methodology,” he said

The Property for Income Fund was established in 1998 and has delivered 13.25 per cent a year since inception; the S&P 200 Property Trust Index returned a 10.91 per cent return over the same period.

APN Funds Management had $4.3 billion in funds under management at the end of March.