AMP Capital Core Property Fund is designed to deliver income and capital growth whilst mitigating risk through the diversification of different types of real estate investments.
– During August, the Dexus Core Property Fund (DCPF or the Fund) experienced a solid positive return. The positive return was driven by the listed portfolio, with the unlisted portfolio relatively static for the month. The Fund’s one year return is negative, however over the 3, 5 and 10 year horizons the Fund is showing solid positive returns. During the month the Mirvac Wholesale Office Fund reported that, as part of a capital management strategy, it intended to reduce its distribution pay out ratio in the short term (next 18 months) to 40%. This change in distribution methodology will negatively impact the distributable income of DCPF over the affected period.
– The listed component delivered a +1.75% return (before fees) in August. At a country level, the main contributors were Australia, Singapore and Japan, whilst the main detractor was the US. At a sector level, the main contributors were holdings in industrial, data centres and healthcare whilst retail detracted.
– The largest contributor for the period was Goodman Group, which is one of the largest positions in the Fund. Goodman reported strong earnings for FY23, underpinned by demand for high quality industrial properties globally. Goodman also communicated that they are sitting on a material opportunity within their portfolio to convert existing facilities to data centres. This opportunity should drive significant value for Goodman and was well received by the market.
What is AMP Capital Core Property A AMP Capital Core Property A is an Managed Funds investment product that is benchmarked against Dvlp Global Real Estate and sits inside the Property - Unlisted and Direct Property Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The AMP Capital Core Property A has Assets Under Management of 467.47 M with a management fee of 1.19%, a performance fee of 0.00% and a buy/sell spread fee of 0.28%.
How has the investment product performed recently?
The recent investment performance of the investment product shows that the AMP Capital Core Property A has returned 2.89% in the last month. The previous three years have returned -2.08% annualised and 8.44% each year since inception, which is when the AMP Capital Core Property A first started.
How is risk measured in this investment product?
There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since AMP Capital Core Property A first started, the Sharpe ratio is NA with an annualised volatility of 8.44%. The maximum drawdown of the investment product in the last 12 months is -4.59% and -39.03% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
What is the relative performance of the investment product?
Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The AMP Capital Core Property A has a 12-month excess return when compared to the Property - Unlisted and Direct Property Index of 9.74% and -0.04% since inception.
Does the investment product produce Alpha over its Peers?
Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. AMP Capital Core Property A has produced Alpha over the Property - Unlisted and Direct Property Index of NA% in the last 12 months and NA% since inception.
What are similar investment products?
For a full list of investment products in the Property - Unlisted and Direct Property Index category, you can click here for the Peer Investment Report.
What level of diversification will AMP Capital Core Property A provide?
AMP Capital Core Property A has a correlation coefficient of 0.93 and a beta of 1.67 when compared to the Property - Unlisted and Direct Property Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.
How do I compare the investment product with its peers?
For a full quantitative report on AMP Capital Core Property A and its peer investments, you can click here for the Peer Investment Report.
How do I compare the AMP Capital Core Property A with the Dvlp Global Real Estate?
For a full quantitative report on AMP Capital Core Property A compared to the Dvlp Global Real Estate, you can click here.
Can I sort and compare the AMP Capital Core Property A to do my own analysis?
To sort and compare the AMP Capital Core Property A financial metrics, please refer to the table above.
Has the AMP Capital Core Property A been independently verified by SMSF Mate?
This investment product is in the process of being independently verified by SMSF Mate. Once we have verified the investment product, you will be able to find more information here.
How can I invest in AMP Capital Core Property A?
If you or your self managed super fund would like to invest in the AMP Capital Core Property A please contact 33 Alfred Street, Sydney via phone +61 2 8048 8162 or via email askamp@amp.com.au.
How do I get in contact with the AMP Capital Core Property A?
If you would like to get in contact with the AMP Capital Core Property A manager, please call +61 2 8048 8162.
Comments from SMSF Mates
SMSF Mate does not receive commissions or kickbacks from the AMP Capital Core Property A. All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - July 31, 2023 – During July, the Dexus Core Property Fund (DCPF or the Fund) experienced a minor negative return. A negative valuation movement in respect of the Dexus Wholesale Shopping Centre Fund (DWSF) as at 30 June 2023 (reflected in DCPF returns for July) offset a positive return from the listed portfolio. The Fund’s one year return is negative, primarily reflecting the material valuation overlay that was applied to the Mirvac Wholesale Office Fund investment in May 2023 and negative valuation movements in DWSF. Over the 3, 5 and 10 year horizons the Fund is showing solid positive returns.
– The listed component delivered a +2.42% return (before fees) in July. At a country level, the main contributors were holdings in Australia, the US and the UK, whilst the main detractor was Hong Kong. At a sector level, the main contributors were holdings in residential rentals, industrial and data centres whilst self-storage detracted.
– During July the European market was the best performer, with the European Central Bank’s dovish tone signalling the worst of the tightening monetary conditions may be behind us. In addition, the region was bolstered as inflation in the UK showed signs of slowing.
– Self-storage was a weak performer in July as fundamentals decelerate from very elevated levels post COVID, but continue to be positive overall. Two large acquisitions by major landlords demonstrated confidence in the sector and should provide investors with comfort around the growth outlook for the sector.
Performance Commentary - June 30, 2023 • During June, the AMP Capital Core Property Fund (CPF or the Fund) experienced a minor negative return. A negative valuation movement in respect of the Dexus Wholesale Shopping Centre Fund offset a positive return from the listed portfolio and distributions of 1.03%. The Fund’s one year return is negative, primarily reflecting the material valuation overlay that was applied to the Mirvac Wholesale Office Fund investment in May 2023. Over the 3, 5 and 10 year horizons the Fund is showing solid positive returns.
• The listed component delivered a +0.3% return (before fees) in June. At a country level, the main contributors were holdings in the US, New Zealand and Japan, whilst the main detractors were the UK, Hong Kong and Belgium. At a sector level, data centres outperformed due to a positive narrative off the back of stronger than expected results from NVIDIA, which is a major supplier to the data centre market. With the tailwinds for AI being appreciated by the market, our positions in NEXT DC, Equinix REIT Inc and Digital Realty Trust REIT Inc performed well over the period.
• During June inflation remained stickier than central banks would like, resulting in a hawkish approach globally and an increase in bond yields. As a result, the REIT sector underperformed equities that were driven by the US listed mega cap technology companies.
• Our view is that investing in real estate that has a sustainable growth profile is key. We continue to focus on real estate sectors that will benefit from structural changes in the economy, including increased digitisation.
Performance Commentary - May 31, 2023 • During May, the AMP Capital Core Property Fund (CPF or the Fund) experienced significant negative returns. The major contributor to the negative return was the application of a -20% valuation overlay to the Fund’s investment in the Mirvac Wholesale Office Fund (‘MWOF’). This overlay contributed c. -8% to the overall Fund return for May. The valuation overlay was applied in accordance with the Fund’s Valuation Policy and reflects trading activity in MWOF units at a material discount to the previous Net Asset Value reported by MWOF. The valuation overlay ensures the Fund’s assets are recorded at market value and that all investors are treated equally.
• The Fund’s one year return is negative, reflecting the above valuation overlay and a challenging period for the listed portfolio where returns have been -5.7%. Over the 3 year, 5 year and 10 year horizons the Fund is showing solid positive returns.
• The listed component delivered a -1.1% return (before fees) over the month. At a country level, the main contributors were holdings in Australia and Canada whilst the main detractors were the United States, United Kingdom and Hong Kong. At a sector level, the main contributors were holdings in Data Centres and Diversified.
• May was mixed for the asset class but overall, the sector was down and underperformed equities. The returns from the sector were driven in part by higher interest rates and inflation in several markets. During the month we saw M&A in the sector, building on the emerging activity we saw in April and indicating confidence in the underlying real estate markets.
• As inflation and interest rates remain elevated, we continue to focus on long term sustainable growth as economic growth concerns are a near-term risk.
Performance Commentary - April 30, 2023 • During April, the AMP Capital Core Property Fund (CPF or the Fund) experienced slightly negative returns, with gains in the listed portfolio offset by negative valuation movements in the unlisted portfolio. Over one year the fund is in negative territory, reflecting a challenging period for the listed portfolio where returns have been -13.0%; and negative valuation movements for the unlisted portfolio since 31 December 2022. Over the longer-term horizon of 3 years plus the Fund is showing solid positive returns.
• The unlisted portfolio experienced negative returns over the month, related to valuation decrements reported as at 31 March 2023 and reflected in CPF’s April performance figures. The valuation movements primarily related to a softening of capitalisation rates in the Mirvac Wholesale Office Fund.
• The listed component delivered a 3.45% return (before fees) over the month. At a country level, the main contributors were Australia, the United States and Japan, the main detractors were holdings in Hong Kong, Sweden and Canada. At a sector level, the main contributors were holdings in Residential Rentals, Industrial and Healthcare.
• During the month the Reserve Bank of Australia (RBA) paused their hiking cycle. Whilst inflation continues to cool from its peaks, it remains well above the RBA target range and some market participants are suggesting the RBA may tighten further. In April we saw the signs of M&A activity with a merger in US self-storage and an acquisition in UK Logistics. This shows the re-emergence of private equity capital that has been side lined recently and investor demand remains robust for certain real estate sectors.
Performance Commentary - January 31, 2023 During January, AMP Capital Core Property Fund (CPF or the Fund) experienced a positive return, with gains occurring in the listed portfolio. Over one year the fund is in negative territory, reflecting a challenging period for listed portfolio where returns have been – 14.0%; however over 2 years and longer-term horizon of 5 years plus the Fund is showing strong positive returns.
The unlisted portfolio was slightly negative in the month, with negative valuation movements in MWOF as at 31 December 2022 being reflected in the January performance for CPF.
The listed component delivered a 4.7% return (before fees). At a country level, the main contributors were holdings in Australia, Europe and the US. At a sector level, the main contributors were holdings in the diversified, data centre, hotels and industrial sectors. In the current environment, dominated by talks of “soft landings” and an earlier peak in interest rates, property stocks were led by the more volatile fund managers, with positions in Goodman Group and Charter Hall benefiting from this theme.
Performance Commentary - October 31, 2022 During October, AMP Capital Core Property Fund (CPF or the Fund) experienced a strong positive return, with gains in both the listed and unlisted portfolios.
The Fund is in negative territory over the past 12 months, reflecting a challenging period for listed markets; however over 2 years and longer-term horizon of 5 years plus the Fund is showing strong positive returns.
The unlisted portfolio benefited from positive valuation movements in the Mirvac Wholesale Office Fund (MWOF) 30 September valuations that were reflected in the October performance figures for CPF.
The listed component delivered a 6.03% return (before fees), reflecting a rally in listed markets during the October. The rally was assisted by a softening of central back interest rate stance (Australia), continued strong earning fundamentals in the US and stabilisation of Government and budget concerns in the UK.
Performance Commentary - August 31, 2022 During August, the Fund experienced negative returns, driven by losses in the listed sector as the global market priced in a higher risk of elevated interest rates and associated negative economic impacts. The Fund is slightly negative over the past 12 months in what has been a challenging period for the listed sector, however, is showing strong returns over 2 years.
The AMP Capital Wholesale Office Fund (AWOF) gained 0.60% during the month on a total return basis (before fees). The performance of AWOF from an income perspective was consistent with previous months and with an increasing number of tenants occupying the recently completed Quay Quarter Tower (Sydney). There was a positive capital return of $9.7m associated with revaluation of the South Eveleigh, Sydney asset in which the fund has a 33% share.
The AMP Capital Shopping Centre Fund (ASCF) gained 0.11% during the month on a total return basis (before fees). The performance of ASCF was driven by strong income returns with rental receipts at high levels. Valuations during the month were generally flat, apart from Rockingham that experienced a negative movement due to a softening on the capitalisation rate.
noThe listed real estate component returned -4.07% (before fees) in challenging market conditions. At a country level, the main detractors were holdings in the United States and Australia. At a sector level, the main detractors were holdings in the industrial and specialised REITs. Markets began the month focused on earnings commentary, which was generally better than expected across most segments. The industrial sector continued to deliver strong fundamental results, with Goodman Group announcing a 25% increase in operating profit, however the sector has been particularly impacted by comments from the Federal Reserve during the month indicating that it is willing to risk economic pain in pursuit of controlling inflation. At a stock level, the largest contributors were holdings in Charter Hall Group (diversified), Lifestyle Communities (manufacturing homes) and Extra Space Storage (self-storage), while the largest detractors were holdings in Arena REIT (Childcare), Goodman Group (Industrial) and Prologis (Industrial).
Note: A small cash holding remains in the AMP Capital U.S. Plus Property Fund, which has been terminated. The cash will be held until the expiry of representation and warranty periods, expected to occur during the second half of 2022.
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