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Many of the Investors asked for a Continuation of the Fund – Not all Investors could be convinced
SEB ImmoInvest will be dissolved: First redemptions planned for June 2012 – Followed by semi-annual redemptions
Equal treatment of all Investors through transparent process
Investors decided together with the fund management about the future of SEB ImmoInvest. Many of the investors asked for a re-opening and continuation of the fund. The announced amendment of the fund rules in line with the German Investment Act as amended by the Act for the Improvement of Investors Protection and Market Functionality, which would have taken effect with the re-opening, was regarded as a sustainable development for open-ended real estate funds. Unfortunately, not all investors could be convinced to stay in the fund. As a result, all redemption requests collected until 7 May 2012 exceeded considerably the liquidity in the fund. In order to treat all investors equally, the fund management will not execute any redemption request and will, in consultation with the Federal Financial Supervisory Agency BaFin, dissolve the fund by 30 April 2017.
“I deeply regret the result and, in the name of the whole team of SEB Asset Management AG, I am thankful for all the encouragement, support and commitment we have received ”, says Barbara Knoflach, CEO of SEB Asset Management AG.
The result shows that, despite all efforts, the liquidity required could not be met without jeopardizing the quality and structure of the SEB ImmoInvest portfolio in case of a re-opening of the fund. A balance of interest between investors who wished to stay invested and those who asked to leave the fund could not be achieved.
Two groups of sellers could be identified: those investors whose investment strategy ended during the last two years and who were in need of their money and those, who felt alienated by this type of investment. The never-ending chain of bad news in the financial industry as well as the troubled waters open-ended real estate funds got themselves into over the last two years, have demoralized investors to the extent that they were no longer willing to grapple with arguments and ideas for the development of this type of investment. Under these circumstances, the fund management is going to pursue a speedy payout of investor’s money by a strategically thought-out sale of the real estate portfolio. To grant all investors quick access to their investments, redemptions approx. amounting to 20% of the fund assets are planned for June 2012 followed by semi-annual redemptions, whose amount depends on the real estate sales to be realized.
Barbara Knoflach underlines: “We will do everything in our power to continue SEB ImmoInvest’s 23 year success story while it is being dissolved. The stable returns of the past years will be our motivation. You can be assured that the team of SEB Asset Management will try its very best to achieve the best possible outcome for its investors.”
SEB ImmoInvest with a fund volume of about 6 billion Euros was launched in May 1989 and is a classic among open-ended real estate funds. Currently, it is invested in 132 real estates in 18 countries and 64 cities. Since inception until today, the fund showed a performance of 219.7%, or above 5.2% p.a. on average (BVI-method). According to a long-term comparison over 20 years by BVI, SEB ImmoInvest achieved the best performance of all open-ended real estate funds.