Raiffeisen Real Estate Fund

Investment policy

The objective of Raiffeisen Real Estate Fund is to achieve maximum capital growth with assuming medium risk while operating the properties in its portfolio. The fund manager takes into consideration both the diversification of risks and potential returns while making the investment decisions. Investments are targeted primarily in Budapest and its metropolitan area, secondarily in rural cities. The bulk of the fund is invested into yield generating properties (which provides the opportunity of collecting rental fees). The fund holds real estates and liquid assets also.

We recommend this fund to an investor who…

• is looking for a real estate investment managed by experts;
• wants to benefit from a well-diversified portfolio of properties;
• wants to invest on the market of commercial real estates with an amount which is much smaller than the value of the properties;
• is looking for an asset which is not driven by the stock exchanges, so excellent for diversifying the portfolio;
• is willing to invest a part of his portfolio for a longer time (the recommended minimal investment horizon of 3 years);
• is willing to tolerate the high liquidity risk of the fund: in case the placed redemption orders endanger the liquidity of the fund, the unit trading could be suspended by the Asset Management Company (for maximum 1 year which can be extended by another year by the National Bank of Hungary)

Benefits of the fund

• Diversified portfolio: commercial properties, office buildings, industrial and logistics real estates;
• The return of the fund is driven by long term stable leases;
• Daily asset valuation;
• Flexible investment form: the units can be bought or redeemed on every banking day (except for the extraordinary situations)

Special risk profile:

• Real estate markets are sometimes characterized by great price volatility;
• Property valuation risk: underlying assets can be temporarily under or over valuated, which affects the Net Asset Value
• Real estate utilization risk: the Fund wants to benefit from the rental fees of its properties. Rental fees and the opportunity of collecting rental fees depends on the solvency of the renters and the maintenance and operation costs
• Suspended or paused trading: in case the placed redemption orders endanger the liquidity of the fund, the unit trading could be suspended by the Asset Management Company (for maximum 1 year which can be extended by another year by the National Bank of Hungary)

About the properties

The fund invests mainly in office buildings located in Budapest with stable, long term tenants. The top holding is Parkway Budapest which is fully rented by the Hungarian State Railways Company. Commercial properties includes shopping centres (Rózsakert Budapest, Szinvapark Miskolc), branch offices of Raiffeisen bank (Andrássy str. Budapest, Kecskemét, Érd, Dunaújváros, Ajka, Nagykanizsa, Gyöngyös) and other retail real estates (OBI department store). The Fund has industrial properties in Győr (Suppliers of AUDI) and warehouses in Budapest and in Pécs.

Available share classes

Raiffeisen Real Estate Fund is available in different FX denominations and settlement structures. The number of outstanding investment units of A, B, C, D and U share classes is limited: if the maximum number of units available for distribution is reached, the distributor stops accepting further purchase orders until the number of outstanding units drop below the limit again . A180, D180 and U180 share classes has no limits for outstanding units but the settlement structure is different: financial settlement of the redemption of the investment units takes  141 trading days.

Factsheet