“With the potential to provide an escalating income starting at 7% per annum after fees, the fund is attractive to investors who want a high income and retirees who seek to maximise their pension in South Africa’s high inflation environment,” said Eric Jones, chief executive of Plexus Wealth. “By mirroring our model portfolio offered to private clients who value high income above the need for growth, we can make this type of investment accessible to all investors.”
The fund invests in both local and offshore listed property. Although the fund is predominantly invested in local listed property stocks, it also provides exposure to Redefine International and Polish listed property company Echo Polska Properties. This adds an element of Rand hedge to the portfolio.
“While property yields are sensitive to movements in Government bond yields, which have been somewhat volatile of late, property remains an attractive asset class,” said Amanda de Wet, Plexus Wealth portfolio manager. “Property has consistently outperformed local equities, bonds and cash over the past 15 years and is surpassed only by offshore equities in recent times due to the negative impact of political events in South Africa and the ratings downgrades.
“The fundamentals for listed property remain solid even though the growth in distributions is now more in line with inflation than the double-digit figures delivered by several listed property companies over the past five years. We believe a forecast total return of 10% to 12% is very attractive in the current low-growth environment.”
The Plexus Wealth BCI Flexible Property Income Fund, which falls within the SA Multi-Asset Flexible category, enhances the Plexus Wealth offering and increases its funds under management to four funds.
Plexus Wealth has a successful long-term track record in property fund management. The Plexus Wealth BCI Property Fund, launched on 12 June 2009, has achieved an average return of 19% per annum over the past seven years up to 30 April 2017. The fund ranks second out of the 56 property funds in its category.
Investors can invest monthly amounts from R1 000 or lump sums from R25 000 in the new fund.