L&H cuts AUM target amid uncertainty over realty fund
Play
Land and Houses Fund Management has slashed its Bt40-billion target for assets under management (AUM) this year due to uncertainty over its planned Terminal 21 Property Fund, while aiming to swing to a profit next year after wiping out its retained losses
Managing director Chantana Kanchanagama said yesterday that the revision was due mainly to a reduction in a planned property fund’s size to about Bt10 billion from Bt20 billion.
The proposed property fund, which has already got the Securities and Exchange Commission’s approval for an initial public offering by the end of this year, will invest in Terminal 21 and Home Product Centre, better known as HomePro.
However, the property fund might be changed into two real-estate investment trusts (REIT) – one for Terminal 21 and the other for HomePro. That decision will likely be seen late this year.
Mutual fund
“Changing to another plan from a new property fund to the LH Thai Property Fund, a mutual fund that will invest in property funds listed on the Stock Exchange of Thailand, has prompted a cut for this year’s target.
“The company sees now as timing for investment in the secondary market rather than a new fund. The fund sets a target for return at no less than 6-7 per cent,” she said.
The company’s plan to increase the capital for the Quality Houses Hotel and Residence Fund, which will invest in the Centre Point-Bangrak Hotel this year, was still on track.
The company did not focus mainly on its assets under management, but on making a profit from its existing businesses.
The company suffered a net loss of Bt6 billion and carries retained losses of Bt30 billion.
Of total mutual funds, about half are equity and fixed-income mutual funds and half property funds. Provident funds totalled Bt1.4 billion.
The company, which has an REIT manager licence, will also seek a trustee licence.
