Harbour homes in on real estate
Harbour Asset Management has rolled out a new real estate PIE fund to give investors a defensive investment home.
Thursday, October 4th 2018, 8:08AM
Portfolio manager Shane Solly says the fund will invest in New Zealand and Australian real estate assets, and it has the ability to invest into other markets and even unlisted property.
Harbour has launched the fund as it expects a wider range of volatility in markets. It remains positive on company earning and equity markets, but wanted to offer investors a fund in a market where there will be less volatility.
The fund will be actively managed and there is the ability to add value in this area because of wide variance in returns from listed property securities.
“Harbour’s research shows that listed real estate may not be the passive investment class that many investors think it is,” Solly says.
Solly says Harbour has done a lot of research around what drives returns in the property sector. While many people think it's interest rates the research shows there are periods of times when returns are driven by factors other than interest rates.
This divergence in return drivers means there is plenty of opportunity to add value through active management.
Solly says there is a perception that property performed pretty badly after the GFC, however he points out a lot of things have changed.
He says there still be cycles, but companies are better positioned with lower debt levels, and there is now a wider source of where they get debt, including bonds.
Dividend payouts are much more conservative than before the GFC, and companies have better governance.
The fund aims for sustainable income and growth.
FOR MORE ON THIS NEW FUND CLICK HERE
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