New fund provides exit opportunity to wholesale investors in frozen funds.
Investors in some unlisted, frozen property funds will be given an opportunity to sell their units with the launch of a new property securities fund.
Melbourne-based property fund manager Key Capital's Unlisted Property Securities Fund will target units in commercial property funds at a discount to current valuations.
"It is estimated that unitholders in unlisted property trusts are clutching $2 billion in frozen assets - with no available buyers," Key Capital managing director Andrew Patrick said.
"For investors in our fund, there are capital gains to be made both from buying assets at a significant discount to current values and from future capital growth.
"There is also potential income from rental revenue and that too is likely to increase over time. Therefore, the potential upside is significant for those who invest now and hold until the market normalises."
Patrick said while some large-scale purchases of this nature were being undertaken by major institutional investors, Key Capital's Unlisted Property Securities Fund would provide a similar opportunity to medium-sized institutional investors through to individual retail buyers.
Units in the target funds will be purchased via the Transfer Asset Group to facilitate transactions in illiquid property assets and a product disclosure statement will be available on Key Capital's website from 26 March.
Key Capital said it was looking to seed the first Unlisted Property Securities Fund with $2 million and raise between $25 million and $50 million.
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