LINDSAY WILLIAMS: In just over two years its assets have reached 1.2 billion, and that’s close to the size of an optimal property portfolio. Is that what it is - it’s just got too big?

MALCOLM HOLMES: There are two arguments. The size argument is definitely one of them. You find that the listed property market is relatively small, so typically what happens - as the fund grows, your available opportunity set diminishes. We obviously want our underlying managers to have the greatest flexibility possible, to produce the best returns possible. Clearly, at R1.2-billion - you’re starting to own a large portion of the market. So yes, it is a big concern for us.

LINDSAY WILLIAMS: How has your performance been, since inception?

MALCOLM HOLMES: The performance has been pretty good. I think South Africans have been pretty spoilt in the property market. Looking back, the property market did about 41% in 2004, and about 35% per annum, compound, for the last three years. We launched roughly, at the beginning of 2003 - so we’ve had the better part of that.

LINDSAY WILLIAMS: What about the view that R1.2-billion - as you say, that the listed property sector is relatively small compared to other sectors? Are you going to have problems getting out when you need to?

MALCOLM HOLMES: That is also part of the equation - in terms of capping the fund. I think one of the key benefits of this particular fund - it is a multi-managed fund, so we have two underlying managers. What we have found is that liquidity, as a whole, has improved tremendously. However, by having two managers - with half the portfolio each - it is less of a problem than having one portfolio managed by one single manager. So yes, the shares are split amongst the two underlying managers. From their perspective, it is probably a bit easier to trade.