St George Bank's funds management arm Advance Asset Management (Advance) has tilted its property-securities multi-blend fund towards international property and hiked its fees as a result.
The manager has appointed global property trusts CB Richard Ellis and European Investors to its manager line-up and terminated one of its two domestic managers.
The fund is now 50 per cent exposed to international and 50 per cent exposed to domestic property.
Advance said it had selected CB Richard Ellis because its benchmark-aware approach was likely to be less volatile.
It chose European Investors for its more active, opportunistic style of investing.
The manager said that as a result of the changes fees on both its properties securities funds would increase from 0.67 per cent to 0.95 per cent.
Advance said that increase was due to "an additional level of complexity in managing property securities on a global level".
Before the changes Advance divided a $391.7 million domestic property mandate evenly between Perennial and Credit Suisse.
The international property dimension is a departure for Advance, which previously only invested through domestic listed property trusts.
Ratings agency Standard & Poor's (S&P) has put the fund's three-star rating on hold as a result.
"Advance's change in mandate warrants S&P's 'On Hold' rating and a subsequent review of Advance's rationale and multi-manager process regarding the diversified property-securities strategy," S&P fund analyst Jane Wu said.
The property funds are not the only part of Advance's business under review.
The firm's International Shares Core Fund, International Sharemarket Fund and International Shares Multi-Blend Fund were put on hold by research house Morningstar in August.
The ratings freeze came after seven members of Advance's international shares manager, the US-based Boston Company Asset Management, defected to a rival fund.
