Standard & Poor’s Fund Services released its ratings on 21 funds in the International Property – Listed sector review. Most ratings have remained stable, with 15 affirmations, but we also downgraded three funds and upgraded two. One fund managed by Advance remains ‘On Hold’. In this review, we noted that performance of funds in this sector is still constrained by global economic events, despite signs of improvement.
“We affirmed our five-star ratings, retaining our highest level of conviction in two funds managed by CBRE Clarion Securities (formerly ING Clarion Real Estate Securities) and AMP Capital Brookfield, who remain the standout managers in the rated peer group,” said S&P Fund Services analyst Peter Ward.
We upgraded two funds managed by RREEF due to our increased conviction since our previous rating review. The RREEF team is one of the best resourced in the rated peer group, with significant experience and expertise in both direct- and listed-property securities investment. Changes within the global portfolio-management team appear well considered and investment team stability and continuity of stock coverage have also improved,” added Mr Ward.
In addition, we downgraded three funds, two managed by Invesco and one by Resolution Capital from four stars to three stars. Our conviction in the Invesco funds’ ability to consistently exceed their performance objective has been tempered somewhat due to the manager’s relatively conservative portfolio positioning. This follows a period of underperformance over several years. For Resolution Capital, over the past 18 months there have been a number of significant team changes. In our view, despite our high regard for the senior portfolio managers, the team is unlikely to be at full strength for a period. Importantly, in both cases, we retain conviction that they can achieve their respective performance objectives.
