A property hedge fund set up by CB Richard Ellis has delivered a return of 29% in its first year, massively outperforming the wider property market.
In comparison, the Investment Property Databank monthly index showed property in general provided a return of –12% in the same period.
Up or down
The fund, which is a joint venture with investment manager Reech AiM, has the freedom to invest in derivatives, shares and take positions in unlisted funds in order to provide a return of 15% above the London Interbank Offered Rate, whether the general property market is heading up or down.
In April, the fund provided a return of 0.87%. Fund Manager Stephen Ashworth was positive on the funds ability to generate similar returns going into its second year. ‘The market environment today contains many features which will play well to Iceberg strategies, uncertainty around future returns and valuations, price volatility, and an increasing focus on fundamentals. These coupled with the still growing investor interest in real estate as an asset class means Iceberg has an increasing opportunity set from which to pick appropriate strategies.’