FTSE Group (“FTSE”), the award winning global index provider, announces the licensing of MSS Real Estate LLP (“MSS”) to create the FTSE UK Commercial Property Index Fund Limited, a new closed-ended investment company to be listed on the Main Market of the London Stock Exchange which tracks the FTSE All UK Property Index, the headline index of the FTSE UK Commercial Property Index Series (“Index”).
Launched in 2006, with data back-cast by FTSE to 2001, the Index is calculated daily and is designed to reflect the investment performance of retail, office and industrial property in the UK. The Index also provides investors with a definitive daily measure of the performance of over £60 billion of investable, institutional grade commercial property across the UK, offering a liquid and diversified alternative to direct property investment.
Key features of the index series include low volatility and low correlation to equities and bonds (see below chart for 10-year performance) (although the closed-ended investment company may not necessarily share the same volatility or correlation characteristics as the index). The comprehensive index also provides investors with 100% exposure to UK investable commercial property.
Imogen Dillon-Hatcher, Executive Director, Global Sales, FTSE noted: “FTSE is pleased to announce the licensing of MSS to create the FTSE UK Commercial Property Index Fund. The index reflects the investment performance of property assets in the UK, offering a liquid, representative exposure to the UK commercial property landscape.”
Mark Ellis, CEO at MSS said: “We are delighted to announce the launch of the FTSE UK Commercial Property Index Fund Limited on the Main Market of the London Stock Exchange. The Company is a unique and innovative proposition for institutional and retail investors seeking exchange-traded access to institutional grade, investable UK commercial property without the cash drag or gearing typically associated with real estate funds. The Company will be managed so as to track the FTSE All UK Property Index by replicating its constituents and expects to generate returns comparable to direct investment in a diversified, balanced real-estate portfolio. The Company has also adopted sector-leading discount control features designed to prevent the Company’s shares from trading at a significant discount to net asset value.”