Managers annual short report for the period: from launch on 3 May 2014 to 31 December Ignis UK Property Fund (PAIF)

Transcription

1 Managers annual short report for the period: from launch on 3 May 2014 to 31 December 2014 Ignis UK Property Fund (PAIF)

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3 Introduction to your short report Dear Investor, Welcome to your annual short report for the period from launch on 3 May 2014 to 31 December As you will be aware, we send you a managers report every six months relating to the Fund you are invested in. The Long Report & Accounts are still available should you wish, and can be obtained by contacting Investor Support on Yours faithfully David Cameron Head of Investor Services & Provider Oversight 1

4 Ignis UK Property Fund (PAIF) Investment objective The objective of the Fund is to invest primarily in UK commercial property to provide a combination of income and capital growth over the long term. Investment Policy The Fund will aim to diversify risk by seeking exposure to three main sectors: Retail (e.g. shopping centres, retail warehouses, standard shops, supermarkets and department stores); Offices (e.g. standard offices and business parks): and Industrial (e.g. standard industrial estates and distribution warehousing) In addition, the Fund may also gain exposure to other property sectors (eg leisure parks, restaurants, pubs, hotels, student accommodation and residential). The Fund will seek geographic diversification across the UK amongst properties held. The Fund may also invest in other property related assets (including property related transferable securities and property related collective investment schemes), money-market instruments, deposits, money market related collective investment schemes and government and public securities. The Fund may also invest in derivatives and forward transactions but only for the purposes of hedging (which includes efficient portfolio management), not for the purpose of meeting the investment objectives. Risk Profile The Ignis UK Property Fund is suitable for investors who are interested in the UK commercial property market and are aware of the associated increased investment risks. Investment in the Fund should be regarded as a long term investment. The value of units and any income from them can go down as well as up and is not guaranteed. Please note, property investments are relatively illiquid compared to bonds and equities and can take a significant length of time to sell or buy. Under exceptional circumstances this could lead to a temporary suspension of dealing in the fund. 2

5 Fund facts Launch date 3 May 2014 Fund size as at 31 December ,444.4m Initial charge 5.25% Annual management charge Class A Class I 1.50% 0.75% Sector Property XD date First business day of the month Distribution payment dates Last business day of the month (except Jan, paid 15 Feb) Income Accumulation Ongoing Charges Figure as at 31 December 2014 Class A Class I Class A Class I 1.51% 0.76% 1.51% 0.76% The Ongoing Charges Figure (OCF) shows the operating expenses, annualised, of each share class as a percentage of average net assets of that class for the preceding 12 months. If you require any further information, please contact Investor Support on

6 Summary of Fund performance Share price Period to 31 December Income shares Lowest redemption price (pence per share) Income shares Highest issue price (pence per share) Accumulation shares Lowest redemption price (pence per share) Accumulation shares Highest issue price (pence per share) Class A From launch on 3 May 2014 to 31 Dec 2014 Class I From launch on 3 May 2014 to 31 Dec Distribution record Period to 31 December Income shares Net distribution pence per share (paid during the period) Accumulation shares Net distribution pence per share (paid during the period) Class A From launch on 3 May 2014 to 31 Dec 2014 Class I From launch on 3 May 2014 to 31 Dec Past performance is not a guide to future performance. The value of units can fall as well as rise and is not guaranteed. You might not get back the full amount invested. 4

7 Summary of distribution During the period under review, distributions were paid as follows: Date Paid 2014 A Inc 2014 A Acc 2014 I Inc 2014 I Acc 15 February /29 February March April May June July August September October November December Net asset value Net Asset Value as at 31 Dec 2014 Class A Accumulation Class A Income 96.92p per unit 98.82p per unit Net Asset Value as at 31 Dec 2014 Class I Accumulation Class I Income 97.15p per unit 99.07p per unit Past performance record Dec % growth Dec % growth Dec % growth Dec % growth Dec % growth Ignis UK Property Fund Sector average The past performance information for the period prior to 3 May 2014 is from the Ignis UK Property Fund (an authorised unit trust launched on 15 Dec 2004, which merged into the Ignis UK Property Fund (Property Authorised Investment Trust) on 3 May Source: Lipper, bid to bid, net income reinvested to end December for each year. Note: The sector average is comprised of the 14 UK bricks and mortar funds within the IMA Property sector only. Past performance is not a guide to future performance. The value of units can fall as well as rise and is not guaranteed. Please note that past performance figures are calculated without taking account of the initial charge. 5

8 Sectoral spread of investments as at 31 December 2014 Sector % Office 23.6 Retail 20.1 Industrial 18.3 Other 16.7 Leisure 1.0 Cash and other net assets 20.3 Source: Internal Top ten holdings (by market value) Holding Leamington Shopping Park, Royal Leamington Spa % of Fund value as at 31 Dec Gracechurch Street, London 3.2 Royal Avenue House, 35/47 Kings Road, London Sainsbury s Superstore, 66 Cornard Road, Sudbury West End Retail Park, Glasgow Curzon Street, London America Street & 29 Guildford Street, London 2.1 Blighs Meadow, Sevenoaks 2.0 Solar Park, Highlands Road, Solihull Cornhill, London 1.9 6

9 Fund manager s comment The UK commercial property sector has been a key beneficiary of the relatively robust economic fundamentals supporting the UK economy. According to the IPD Monthly Index, capital values grew by 12.4% p.a., in the main still driven by yield compression as the sector continues to attract a large amount of capital from both foreign and domestic participants. Rental growth continues to improve on a quarterly basis at a broad level with rents expected to pick up further into the recovery cycle. Rents rose by 3.1% p.a. in the 12 months to end December. All main sectors provided positive total returns over the reporting period and year to end December The strongest returns were delivered in the industrial sector closely followed by offices. Capital growth is no longer confined to London and the South East with some regional locations providing positive growth. Propertydata recorded total transactions of 21 billion in Q4 2014, which represented the highest quarterly level of the year, with overseas and UK institutional investors contributing significantly to the market over the quarter. The Fund completed c. 184 million of new investment over the year to end December 2014 with c. 144 million in the period since May 2014, including the purchase of Leamington Shopping Park in Leamington Spa, which is now the Fund s largest asset. Asset management initiatives continue to add value to the Fund with notable successful projects completing at Curzon Street and Kings Road, London; Calverley Road, Tunbridge Wells; and the Grosvenor Building, Glasgow over the period. The economic fundamentals supporting the UK economy remain robust, with a consensus of economists expecting growth of around 2.6% in Along with economic stability, business sentiment and consumer confidence remain at high levels. In terms of outlook, we expect positive total returns for investors on a three-year hold period due to the strong income component and modest further capital appreciation. We continue to seek to acquire further attractive stocks with strong fundamentals to provide a blend of income security and asset management opportunities. Liquidity continues to be managed with due consideration given to both potential inflows and outflows. Over the review period the Fund rose 8.3% compared to a return of 8.2% by its sector average. (Source: Lipper, bid to bid, net income reinvested for the period 03/05/14 to 31/12/14). The sector average comprises of the UK bricks and mortar funds within the IMA Property sector only. There are currently 14 funds in the peer group available for the analysis. Sources: IPD Monthly Index as at end April 2014 and December 2014 IPD Balanced Monthly Index Funds Monthly Benchmark Report April 2014 and December 2014 Lipper, bid to bid, net income reinvested based upon UK Bricks and Mortar Funds identified within Lipper as Real Estate Funds with UK geographical focus within the Standard Life Investments Real Estate Research Propertydata January

10 Availability of long report & accounts If you wish to receive a copy of the annual and half yearly Long Report & Accounts for the Ignis UK Property Fund then please contact Investor Support on They are free of charge. Other information The information in this report is designed to enable unitholders to make an informed judgement on the activities of the Fund during the period it covers and the results of those activities at the end of the period. For more information about the activities and performance of the Fund during this period and previous periods, please contact Investor Support on Ignis Asset Management is the trading name for companies in the Ignis Asset Management Limited group of companies which includes the unit trust manager Ignis Fund Managers Limited and the investment manager Ignis Investment Services Limited. The Ignis Asset Management Limited group of companies is part of the Standard Life Investments group. Share prices and yields appear daily on the Ignis website and the Investment Association (formerly the Investment Management Association) website Money Laundering If you have not already provided us with the required documentation to prove your identity we may have to freeze or terminate your account, and will not be able to accept any further subscriptions. There may also be a delay when repurchasing your investment. Please note that we will have previously contacted you by post if we do not have all the required documentation on file for your account. Authorised Corporate Director (ACD) Ignis Fund Managers Limited (IFM) 50 Bothwell Street, Glasgow G2 6HR Tel: Registered in Scotland No. SC85610 Member of the Investment Association (formerly the Investment Management Association) Authorised and regulated by the Financial Conduct Authority. Directors of the ACD *Appointed with effect 1 July 2014 N K Skeoch* Executive Chairman of IFM and Chief Executive of the Standard Life Investments group; J Aird* Managing Director of IFM; C Clark* Director of IFM and Director of the Standard Life Investments group s Global Client Group; C Fellingham Chief Investment Officer of IFM; R Paris* Director of IFM and Chief Investment Officer of the Standard Life Investments group; C Walklin* Director of IFM and Chief Operating Officer & Finance Director of the Standard Life Investments group. Resigned with effect 1 July 2014 C Samuel; C Chene; C Bannister; J McConville; D Watts; and E Stobart. Resigned with effect 30 September 2014 G Hotson Investment Adviser Ignis Investment Services Limited 50 Bothwell Street, Glasgow G2 6HR Registered in Scotland No. SC Authorised and regulated by the Financial Conduct Authority. Depositary Citibank International Limited Registered office: Citigroup Centre Canada Square, Canary Wharf London E14 5LB Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Independent auditors to the Fund PricewaterhouseCoopers LLP 141 Bothwell Street, Glasgow G2 7EQ Registrar and Correspondence address Ignis Fund Managers Limited PO Box 9028 Chelmsford CM99 2WH Authorised Status The Company is a non-ucits retail scheme ( NURS ). The Company is also a UK Authorised Investment Fund UK AIF for the purposes of FUND. The Ignis UK Property Fund will be managed so that it is a Property Authorised Investment Fund (PAIF). 8

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12 Investor Support Call: Telephone calls may be monitored and/or recorded for the purposes of security, internal training, accurate account operation, internal customer monitoring and to improve the quality of service. Please note the Key Investor Information Document (KIID), the Supplementary Information Document (SID) and the Full Prospectus are available free of charge. For a copy, phone Investor Support on Past performance is not a guide to future performance. The value of units and the income from them can go down as well as up and is not guaranteed. Property investments are relatively illiquid compared to bonds and equities and can take a significant length of time to sell and buy. Ignis Investment Services Limited does not accept liability for any claims or losses of any nature arising directly or indirectly from use of the data or material in this report. The information supplied is not intended to constitute investment, tax, legal or other advice. Ignis Asset Management is the trading name of the Ignis Asset Management Limited group of companies which includes Ignis Asset Management Limited, *Ignis Investment Services Limited and *Ignis Fund Managers Limited. Issued by Ignis Investment Services Limited. Registered in Scotland No. SC Registered Office: 50 Bothwell Street, Glasgow G2 6HR. *Authorised and regulated by the Financial Conduct Authority. Ignis Asset Management Limited and its subsidiaries are part of the Standard Life Investments group (Standard Life Investments (Holdings) Limited and its subsidiaries). D