Pengana Capital has closed its property securities fund and has developed an Asian long-short real estate securities fund as part of a real estate securities strategy revamp.
It is very difficult to provide diversification and add value for investors in Pengana's existing Australian Property Securities Fund, Pengana chief executive Russel Pillemer said.
He said diversification was difficult to achieve because of issues within the Australian property market such as concentration, strong correlation with equities and the long deleveraging process.
The top five stocks in the Australian real estate sector now account for about 83 per cent of that sector, according to Pillemer.
In contrast, he said the Asian region offers strong prospects for economic growth and Pengana sees real estate investing as an important part of that process.
"The Pengana real estate team is developing a dedicated Asia Pacific real estate fund with the ability to opportunistically short stocks," Pillemer said.
"Pengana believes that now is the time to develop a dedicated Asia Pacific listed real estate strategy to capitalise on the growth opportunities in this region."
The firm set up an Asian business in July 2007, hiring former Perennial managers to manage an Asian special events fund.
The Asian long-short property fund will be managed by the existing team at Pengana, led by portfolio managers Tim Shaw and Diane Lin.
