That 400 financial advisers crowded into a London conference room last week to hear about New Star’s International Property fund will have done nothing to reassure market skeptics worried that the sector is saturated.
The company expects to attract £200 million ($398.7 million) by the end of June but managers dismissed criticism that the portfolio could be dragged down by a high initial cash weighting. Although there will be just nine holdings at launch the company has a fall-back portfolio of another six that can be purchased if fundraising is on target. Robin Carr, the house’s head of property acquisitions in Europe, said managers are considering investing across 12 countries in total, and have an interest in logistics stocks in the Czech Republic and Poland in particular. But falling vacancy rates in Germany will lead managers to focus on Western Europe at the start. Of the 80% direct property proportion of the fund, managed by Roger Dossett, 40% will be invested in the Asia-Pacific region. The remainder will be invested in Europe but tax restrictions will keep it out of the United States. The other 20% will be overseen by Gregor Logan who will invest 10-15% in Reits with the balance held in cash. (citywire.co.uk)