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Seven Dials ponders global property fund

Property fund manager Seven Dials is planning a fund of Asian property funds that may be a springboard for a global offering.

The company already runs a fund of European property funds and now has the Asian market in its sights. It is recruiting people to research the Asian real estate market and says once the fund is up and running, the next stage of development will be a global fund of property funds.

Seven Dials says there is a trend for institutional investors to make global allocation to property, as they do not want to be restricted to one area. It believes this trend is becoming increasingly common among other types of investors and wants to be a part of this market but has not decided on the timing for a possible launch.

It is also finding value-added opportunities for its European property fund of funds. These comprise buildings where part of the return comes from the manager’s ability to make improvements. It says since the cost of borrowing has risen, it has not been possible to achieve returns by buying and holding properties while values go up. It says managers have to work harder and the best opportunities are found in the value-added category.

Chief executive Brett Robinson says: “We are working on our European fund of funds and will launch the Asian fund as soon as we are able to. There is a big gap between Europe, Asia and the rest of the world but Asia is within our reach and the next step will be global.”

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