Analysis of the UBS (Lux) Real Estate Funds Selection – Global
5 JUL, 2024
By Andrea Sepúlveda from LatamSelf
UBS Real Estate Funds Selection Global is a fund domiciled in Luxembourg, with over 15 years of track record, with a philosophy and a long-term investment approach, selecting the best opportunities in the global real estate market, mainly in Asia Pacific, Europe and North America.
Let's see what its characteristics are and the opportunities it offers to investors.
UBS (Lux) Real Estate Funds Selection - Global
In the sector, the fund aims to offer its investors efficient access to a range of carefully selected real estate investment strategies, but it does not own or control physical real estate properties.
- Investments in a target fund that can be made directly or through the acquisition of instruments that reflect the profitability of said target fund.
- Real estate company instruments or real estate management companies that are listed and traded on a regulated stock exchange based in any jurisdiction.
- Derivative contracts or other financial instruments intended to passively obtain the profitability of the underlying investment of a defined real estate market.
As for its offerings, the fund presents itself as a diversified core strategy for a traditional portfolio of stocks and bonds. It provides monthly liquidity and has a profitability target of 5-7%.
As indicated by the management company, the fund is able to provide access to a customized portfolio, with a low correlation with listed assets, stable returns and diversification by region, sector and risk.
- Management company: as far as UBS AM is concerned, it is one of the world's leading real estate management companies. In addition, UBS AM offers investment solutions in all asset classes. In figures, by mid-2023, the management company was managing over 465 billion EUR, being one of the largest asset managers in Europe, with more than 3,800 employees in its offices, distributed in a total of 23 markets in Switzerland, Americas, EMEA and APAC. As for the fund's numbers, at the end of March 2024, the strategy had more than 6,200 million EUR in assets under management.
Evolution of the UBS (Lux) Real Estate Funds Selection - Global fund
Note: Past performance does not predict future returns. The fund's returns may increase or decrease as a result of exchange rate fluctuations.
Above, the chart of the fund's results offered by the management company in the fund's monthly card. A second chart has been added for comparison with the real estate category and other funds considered for that category.
Investments in Real Estate are medium-long term, therefore examining the performance of the last 5 years, it can be seen that investing in this UBS fund has been more advantageous compared to investing in the direct property index. This fund is a global fund that offers exposure to global Real Estate with quite a broad diversification, including more than 60 funds and over 11,000 underlying properties, which is very interesting when thinking about this type of asset.
As for the diversification of investments in terms of regions and sectors:
The fund is primarily invested in various developed markets, so the team considers this diversified and defensive allocation. As for the sectors, the fund has increasingly moved towards the residential sector. In March 2024, the fund indicated having 63 invested funds, with over 11,000 properties for a value of over 360 billion EUR.
Conclusions
Advantages
- Institutional size and good track record.
- Public instrument with unlisted investments.
- Experience of the UBS management company, which benefits from the global network and local capabilities.
- Diversification, with access to real estate funds that complete the portfolio.
Disadvantages
- Liquidity with restrictions/cautions: redemptions require a 30-day notice.
- Poor transparency of invested instruments.
