The Property Income Trust for Charities (PITCH) managed by Mayfair Capital Investment Management returned 3.3 per cent in 2012, making it the strongest performer of the bespoke property funds designed for charities.
The fund outperformed its peers over a three year period and although the fund is managed on an absolute return basis, it also outperformed the AREF All Balanced Property Funds Index which returned 0.2 per cent in 2012.
Launched in January 2005, the fund has outperformed the AREF All Balanced Funds Index with a total return of 34.7 per cent compared with 18.3 per cent as at 31st December 2012.
Fund director James Thornton says: “The fund has a strong income focus and is conservatively managed to deliver a relatively high and sustainable yield. Accordingly, over 40 per cent of property income is subject to fixed or inflation linked reviews whilst the weighted unexpired lease profile is over ten years. The void rate is also low, enabling us to deliver a yield of over eight per cent to investors in 2012. Furthermore, at a time when charities are feeling the effects of inflation, we were pleased to deliver growing distributions at a level 5.1 per cent higher than those made to investors in 2011.
“With gilt yields starting to rise, there is a fear of capital loss from gilt and fixed interest investments. Along with equities, real assets such as property and infrastructure funds are proving attractive. As a result we expect to see positive investment inflows during the year.
“In response to the continuing weakness in the UK economy, our strategy for the fund remains cautious with a focus on delivering performance from existing assets through asset management, whilst acquiring good quality assets let to secure tenants on ten year plus leases.”