Morley unveils T-Plus: a secondary trading facility for unlisted real estate vehicles

Article date: 19 May 2006

  • Leading team comprising Morley Fund Management,Cazenove and DTZ

Morley Fund Management, working with leading real estate andsecurities houses DTZ and Cazenove, today revealed its plans forT-Plus, a secondary trading facility for units in unlisted propertyfunds, believed to be the first of its kind in the UK.

Driven by considerable investor demand from institutions throughoutEurope, T-Plus will significantly increase transaction speed andliquidity for investors. A trade that would normally take a numberof weeks could be reduced to as short as 10 days with T-Plus.

T-Plus is being set up using the specialist skills of Cazenove andDTZ in both the listed securities and property brokerage markets.It will initially encompass Morley-managed specialist andsector-focused funds in the UK and Continental Europe. Gross assetsfor these funds currently total £9.23 billion (€13.33billion).

The team members of T-Plus have already traded over £500mworth of units during the first quarter of 2006, and it is expectedthat annual turnover through the system will reach 10 to 15% ofunit holdings. T-Plus will initially focus on The Mall Fund, butwill be rolled-out to all Morley’s UK and Europeansector-focused and specialist funds over coming months. Non-Morleyfunds could be dealt with through the system, and Morley is indiscussions with other Investment Managers to facilitatethis.

Philip Clark, head of specialist property funds at MorleyFund Management, said: “T-Plus is a welcome new developmentin the property investment industry enabling secondary trading inwhat for many had seemed an illiquid market. Morley manages sixteenUK and European specialist property funds and this initiative is adirect response to the investor demand we’ve seen.

“This market is maturing rapidly and investors are alreadyactively buying and selling. T-Plus provides buyers and sellerswith a tool that we expect to be of wide interest in the propertymarket, and it provides an investment option outside trading listedshares that until now has been unavailable.”

The secondary trading facility will:

  • Provide greater liquidity for investors, significantlyreducing total transaction time
  • Offer improved trading opportunities through aggregation andpooling of available units
  • Enable the expansion of the investor base through initiationof research coverage by Cazenove
  • Facilitate trades through a uniform set of dealing rules
  • Provide a streamlined and standardised settlement process forthe registration of trades, and
  • Provide greater transparency for investors through websiteprovision of a standardised package of publicly availableinformation on The Mall Fund.

Francis Salway, chief executive of Land Securities Plc,and previously a leading fund manager at Standard Life, commented:“The need for a secondary trading facility has been selfevident for some time, and the increased liquidity that such afacility will bring is great news for the property industry as awhole.”

Richard Kirby, director, property funds, F&C AssetManagement, said: "As investors in The Mall, we warmly welcome suchan initiative to bring greater liquidity and transparency to anincreasingly sophisticated market. We are certainly interested tosee how the service develops beyond The Mall, and will watch thisclosely from both an investor and wider industry basis."

T-Plus goes live this week and it is planned that information ontrades will be made available once a track record has beenestablished.

Investors to have recently acquired units in The Mall Fund includeABP, Europe’s largest pension fund, and Sparinvest, a Danishglobal fund-of-funds. Part of the new system will involve theproposal to reduce the minimum holding size on The Mall Fund fromone million units to £100,000. This should allow a wider investorbase to develop.

It is believed to be the first of its kind because it will be opento more than one fund, is dealing in unlisted property fund units,will provide more publicly available information on the funds andsecondary trades, and is being run in partnership with thirdparties.

-ends-

For further information please contact:
FionaBaker, Morley Fund Management 020 7809 8617
Beth Saint, Morley Fund Management 020 7809 8125
Mike Cutteridge, DTZ 020 7643 6351
Richard Cotton, Cazenove 020 7155 4618

Notes to editors:

About Morley Fund Management

  • Morley Fund Management Limited is the UK-based assetmanagement business of Aviva plc. Firms within the Morley group ofcompanies manage £156bn from offices around the world as at 28February 2006. The property team manages in excess of £23 billionof UK and European property assets, making Morley the largestproperty fund manager in Europe.

Awards

  • 2006, Property Fund Manager of the Year, Property WeekAwards
  • 2006, Outstanding Company of the Year Award, CEE Real EstateQuality Awards 
  • 2006, Investor of the Year Award, CEE Real Estate QualityAwards 
  • 2005, UK Pensions Awards Property Fund Manager of theYear 
  • 2004, Property Week Fund Manager of the Year Award

The property team consists of 70 investment professionals andmanages a range of funds on behalf of institutional, pension andretail clients. Morley has been at the forefront of innovation inproperty fund management and has launched eleven specialist sectorbased funds with partners, including the Jersey-based Unit Trusts:Igloo Regeneration Fund, Quercus Healthcare Property, The Junctionand The Mall.

For further information on Morley’s property funds, visit:www.morleyproperty.com

About The Mall
The Mall is the leading ownerand operator of community shopping centres in the UK. The Mall hasassets of £2.87 billion in 23 shopping centres and has plans togrow assets to 30 centres, establishing The Mall as the UK’scommunity shopping centre brand. The Mall Fund is a specialistproperty fund managed by Capital & Regional and Morley FundManagement.

The Mall Fund, launched in March 2002, was established by clientsof Morley Fund Management and Capital & Regional plc to own andoperate community shopping centres under The Mall brand, throughoutthe UK. The Mall was launched with assets of £656m comprising 11shopping centres.

Four years on investors in the fund include funds managed by INGReal Estate, Prudential Property Investment Managers, ScottishWidows Investment Partnership, Hermes Real Estate, F&C AssetManagement, Arlington Property Investors, ABP, Sparinvest, ColliersCapital, OPC, Capital & Regional and Morley FundManagement.

For further information on The Mall, visit www.themall.co.uk

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