L&G UK Property shareholders have approved the transition of the strategy and its feeder fund to a hybrid model following an extraordinary resolution this morning (10 April).
The hybrid strategy combines direct UK real estate with indirect property exposure through holdings in global Real Estate Investment Trusts (Reits).
Following the transition period, fund managers Michael Barrie and Matt Jarvis will aim to allocate 45% to UK direct property exposure, while a further 45% will be made up of global Reits. The remaining 10% will be held in cash.
After the vote to change investment policy, the transition is set to begin on 12 April.
Meanwhile, the strategies’ names will change to the L&G Property Fund and L&G Property Feeder fund. I class shareholders will also have their headline fund management fees reduced to 0.55% from 0.75%.
James Crossley, LGIM head of UK wholesale, said: “We are delighted to have received approval and support from investors to take forward this compelling new strategy – allowing us to increase low-cost, global, liquidity exposure within the Fund, access new markets, and respond to investors’ need for daily dealing.
“The hybrid property approach is a blended strategy and market-leading solution; balancing the wants, needs and infrastructure capabilities of the advised retail investor market, together with the regulatory backdrop.
“We wholeheartedly believe this solution is in the best interest of investors, and as a sector leader for over 18 years, we are well positioned to continue enabling investors’ access to balanced property exposure.”
Fund manager Matt Jarvis added that a combination of asset sales and further new investment would accelerate the transition.
He said: “Our thematic portfolio continues to provide access to direct UK property, with assets in strong locations across a range of sectors with structural growth potential – such as industrial and self-storage, operational hotels, and build to rent residential. We continue to view the property sector as an attractive diversifier in any balanced portfolio, and believe it is well positioned for investors with long-term horizons.”
