UK - Property investment in 2002 through UK pooled funds totalled 7.7 billion pounds sterling (e11.7bn) and produced returns of 8.8%, compared with 6.6% in 2001 on assets of £7.0bn, according to figures issued by bank HSBC and the Association of Property Unit Trusts (APUT). This compared with a return of –22.7% for the FTSE All-Share index and a 10.3% return on 5 to 5 year gilts.
The leading funds, which are tax exempt vehicles open to pension funds and charities, were the Threadneedle PUT with 12.5% return in 2002, Deutsche UK Managed Property Fund with 11.3% and the UBS Triton Property Fund with 11.0%, among the balanced funds investing in a range of property types. Balanced funds overall returned 8.1% last year and 6.1% in 2001. The assets in the 13 funds in this sector came to a total of £4.4bn.
Among the specialist PUTS, focusing on particular property types, Deutsche UK Retail Property Fund sparkled with a 16.1% return, its nearest competitor being the Schroder Emerging Retail Property Fund returning 10.8%. The median for this group was 8.1%.
The managed property fund category, comprising tax exempt funds managed by insurance companies internally for pension fund clients, made up a third of the pooled marketplace with assets of £2.5bn at year-end, produced returns of 9.5% overall. Threadneedle Pensions did best with 12.2% ahead of Legal & General with 10.8%, Morely Pooled Pensions at 10.4%, Prudential M&G at 10.2% and Clerical Medical at 10.0%.
Overall, the sector covers 25 funds with an average of £306m per fund. The balanced PUTS account for 58% and the specialist PUTS for just 9% of the market. Of the total £7.7bn invested, industrial properties accounted for 22%, retail warehouses 20%, Central London offices 15% and other offices 17%.
The largest funds are Standard Life’s which returned 9.15% with £1,358m, followed by the Schroder Exempt PUT with a 7.9% return and assets of £1,215m and the Merrill Lynch fund with £888m in assets and a 2002 return of 6.4%.