UK -The Association of Property Unit Trusts may need to reinvent itself to adapt to the burgeoning indirect property market, new chairman Chris Laxton (pictured) claims.
Laxton – head of external property funds at Morley Fund Management – said the property market had moved on significantly during the last four years and property unit trusts were now only part of a much bigger picture.
Laxton – who succeeded Simon Radford, chief investment officer, indirect division, at CB Richard Ellis Investors as APUT chairman on January 1 – said: “The biggest single issue for us as an association is to decide whether it is time to reinvent ourselves.
“The debate – which has already started – is should we relaunch ourselves as, for example, The Association of Pooled Property Funds?
“In doing so, we would look to encourage best practice across limited partnerships, managed property funds, unauthorised property unit trusts, maybe even investment trusts.”
Limited partnerships, in particular, are a boom area of the market with an estimated total investment of £16bn compared with £6.5bn in PUTs.
No official figures exist as to the proportion of pension fund investment within the LP market but it is believed to be some way less than 50%, compared with more than 95% for the PUT sector.
Whatever the association’s fate, Laxton is keen to continue APUT’s ongoing pledge to encourage greater transparency and disclosure among its members.
“The association has spent a lot of time developing a code of practice in conjunction with its members and the NAPF to improve pension schemes’ confidence in property unit trusts.”
Laxton believes 2004 will also be a landmark year in terms of legislation.
He said: “The next 12 months are likely to be dominated by major legislative, regulatory, taxation and accounting issues including the FSA’s Consultation Paper 185, the government’s consultation on the potential introduction of real estate investment trusts and the introduction of International Accounting Standards, among others.”
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