A restructuring of the UBS Trumbull Property Fund could see the $20bn core open-ended vehicle sell $1bn of assets next year.
According to Ohio Bureau of Workers’ Compensation (BWC), one of its investors, the fund completed a restructure on 1 July, effectively splitting it into two portfolios and increasing liquidity by creating REIT subsidiaries.
An Ohio BWC board meeting report confirms that a $5bn “non-strategic” portfolio has been separated from the rest of the fund, as previously suggested.
The non-strategic portfolio contains significantly more retail and hotel assets, and has a greater exposure to the office sector, compared with the $14bn ”diversified core portfolio” which contains the ”primary” 297 assets ”held for investment going forward”.
Ohio BWC said the restructure is expected to increase apartment exposure by four percentage points, increase industrial exposure by six percentage points and reduce the weighting to retail by eight percentage points, and reduce office and other sectors by one percentage point each.
The investor also revealed that the value of redemptions requested by investors wishing to exit the fund had risen to $8.3bn at the end of the March, up from $7bn 30 days earlier.
The board report did not provide an update on plans to sell $600m of retail assets this year, as previously reported.
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