Time Investments has launched a new fund offering hybrid exposure to listed real estate securities and direct long income properties.
The Time Property Long Income & Growth fund is a daily-dealing UK-domiciled strategy that has been designed to give retail investors access to the real estate market, with a greater level of liquidity.
The strategy will be co-managed by equity infrastructure managers Stephen Daniels, Roger Skeldon and Chris Cox. Daniels and Cox run the Time UK Infrastructure Income fund, while Skeldon is the manager of Time Commercial Long Income and Time Social Long Income funds.
The latter, which Skeldon runs alongside Daniels, has been among the top-performing UK property funds over three years to the end of August, returning 14.5% to investors versus a sector average of -0.5%, according to Morningstar data.
The fund has a minimum investment limit of £5,000 for retail investors, and will allocate 47.5% of its assets to UK real estate securities, 35% to direct long income property, 10% to non-UK real estate securities and 7.5% to cash.
‘We have launched the fund for investors who want to maintain exposure to direct real estate but with greater liquidity, and benefit from attractive and consistent levels of income relative to equity and fixed income markets,’ Skeldon said.
The managers will target a range of what they describe as ‘economically sustainable sectors’ including supermarkets, care homes, data centres, logistics and healthcare real estate.
Cox said: ‘By focusing on sustainable sectors such as supermarkets and healthcare, which offer long-term growth in revenue streams and inflation-linked rent increases, the new fund enables investors to own a diversified portfolio of real estate securities which should continue to perform well against the backdrop of rising inflation and the possibility of interest rate increases.’
The fund will have no exposure to high street retail or office sectors.
Income from the fund will be paid to investors in February, May, August and November. The fund, with an ongoing charge of around 1.11%, will be available through ISAs, Sipps, SSASs and offshore funds via income or accumulation shares.
Time is a specialist fund manager focused on income-generating assets, mainly through infrastructure, real estate and lending. It is apart of Alpha Real Capital, which has more than £4bn of assets under management.
The launch of the new fund comes at a time when discussions around the liquidity mismatch of open-ended property funds has intensified following the suspension of redemptions in many of these types of funds during Covid-19 and previously after the Brexit vote.
The City regulator has also been looking at ways to address some of the issues of investing in illiquid assets through daily dealing funds and has suggested an increase in redemption notice periods, as well as rolling out the new long term asset fund structure.
Ben Yearsley from Shore Financial Planning said: ‘The hybrid approach seems the obvious future for property funds. The mix of some unique physical property combined with liquid Reits is a compelling proposition. Time’s new fund offers exactly this through real estate securities and direct property exposure in sectors set for long-term growth.’
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