Charities Property Fund

The Charities Property Fund, managed by Cordea Savills, achieved a total return of 11.2%, according to its year-end performance figures for 2013⁽¹⁾. This compares to the AREF All Balanced Funds Index of 9.1%. The Fund also significantly outperformed the other two charity specific funds which produced 9.1% and 7.4% respectively.

In one of its most successful years since inception 13 years ago, the Fund invested £130 million in 15 new assets, reflecting an average yield of 6.5% after the costs of acquisition. It also made four sales, raising £14.6 million. Over the same period the Fund’s dividend increased 4% and is forecast to grow by a further 5% in 2014.

As the original charity-specific property fund with a broad investor base of 1,437 charities, its key investment objective is to deliver a high and secure level of income. In 2013, the Fund delivered an annual income of 5.8%, which compares favourably with the 4.4% p.a. average dividend payable by the funds in the IPD All Balanced Funds Index and 2.8% available on 10-year Gilts⁽²⁾. The Fund is the largest charity-specific property fund having grown by 27% in 2013 through a combination of capital increases and new investment from £492 million to £627 million.

Over 2013, significant value has been added to the Fund through active asset management: for example, 50 new lettings and lease renewals have created or protected £2.35 million p.a. of income and lowered the void rate from 5.4% to just 2%, compared to an IPD average of 10.5%.

⁽¹⁾ Source: IPD
⁽²⁾ Source: GRY Jan 2014

Harry de Ferry Foster, Fund Director, commented:

“The Fund performed tremendously well over 2013 and continues its record of outperforming the AREF All Balanced Funds Index over one, three, five and 10 years and since launch. In the last 12 months we have strengthened our core portfolio, which is well positioned to generate strong returns over the next few years. We look forward to seeing the Fund continue to attract new investors and continue to grow its asset base.”