REAL ESTATE - Morley and CB Richard Ellis will jointly launch a global REIT fund.
The Aviva Funds Global REIT fund, the sub-fund of a Luxembourg SICAV, will invest in listed real estate securities in markets with REITs. The partners said the REITs market had grown from €150bn to €640bn because they offered diversification, liquidity and relatively low volatility.
Strahan Wallis, a Morley spokesman, cited CBRE’s “strong coverage of global property markets”, including a dedicated research team, and Morley’s strength in the European market as factors in the partnership.
Wallis said Morley was “interested” in upcoming REITs legislation, but pointed out that the fund’s global focus meant it was “not reliant” on legislation in the UK and Germany.
In a recent analysis in McKinsey Quarterly, specialists at the management consultancy firm claimed “restrictions and disincentives” in draft REITs legislation in the UK and Germany would “unless rectified…discourage corporate participation and leave the promise of REITs unfulfilled”.
The authors identified insufficient tax incentives, ownership restrictions, a mandatory holding period in the German version and gearing restrictions as potentially significant obstacles to uptake.