Investment policy and objective clarification of the underlying fund of P73 Aviva Investors UK Property
17 June 2019
Friends Provident International Limited (“Friends Provident International”) has been notified by Aviva Investors (“The Company”) of an investment policy and objective clarification of the underlying fund into which P73 Aviva Investors UK Property invests. This change will become effective from 03 July 2019 (the “Effective Date”).
The Company have confirmed:
“We are changing the way we describe the investment policy of our funds…. This is not a change to the way the funds are run, it is just designed to make the funds’ aims and strategies clearer. The following summarises and explains these changes.
The new investment policy wording better describes the funds’ overall strategy and the types of investment the manager will look for. The overall investment objectives are nearly always long-term, meaning fund performance should be judged over five years or more.
We also set out how environmental, social and governance (ESG) criteria are integrated into the investment process and considered alongside a range of financial metrics and research”
The changes to the policy and objective of the underlying fund of P73 Aviva Investors UK Property are shown in the table below.
Investment policy and objective of the underlying fund of P73 Aviva Investors UK Property before the Effective Date
Investment policy and objective of the underlying fund of P73 Aviva Investors UK Property from the Effective Date
To obtain returns via income and capital appreciation.
The underlying fund will invest solely in the Aviva Investors UK Property Fund with the exception of cash balances which may also be held for the purposes of maintaining sufficient liquidity to enable the underlying fund to meet its commitments, such as expenses and redemptions.
The underlying fund aims to provide a combination of income and growth over the long term (5 years or more), through exposure to UK property.
The underlying fund will be invested solely in the Aviva Investors UK Property Fund (the “Master Fund”) other than cash and deposits, which will only be held to ensure that the underlying fund can meet its payment obligations.
Master Fund Strategy and Environmental, Social and Governance (“ESG”) factors:
The underlying fund aims to achieve similar investment returns to the Master Fund. However, returns may be different as a result of the cash and deposits held by the underlying fund.
The Master Fund is structured as a Property Authorised Investment Fund and will invest at least 70% of its assets in UK Property in normal market conditions. The Master Fund’s strategy, including its consideration of ESG factors, is set out below:
The Master Fund is actively managed and the Investment Manager aims to use detailed analysis, expertise and relationships to drive income and growth for investors, rather than relying on property market movements alone. This will include making decisions such as actively managing property transactions, redeveloping properties and the negotiation of leases.
ESG factors are integrated into the due diligence performed before purchasing assets for the Master Fund, and throughout the life of the investment, with the intention of reducing risk, protecting value, and delivering enhanced income and growth. This includes engagement with the occupiers of properties to reduce energy consumption and waste, and to increase community engagement. Identification of ESG risks does not preclude investment in or the continued holding of an asset, as our ability to mitigate risks through active management of assets is also taken into account, and the Investment Manager retains discretion over the investments that are selected for the Master Fund.
Should you have any questions regarding these changes, please contact International Funds & Investments.