Investing in healthcare has seen Australian Unity’s Healthcare Property Trust – Class A Units take out the Direct Property award.
According to Australian Unity head of healthcare property, Chris Smith, focusing on healthcare has been a key part of the fund’s success since its launch in 2009.
Data from FE Analytics showed that it has outperformed that Australia Direct Property sector average by 3.05 per cent from then to the end of last quarter.
“The [healthcare] sector and its attributes – tenants with significant capital investment working with us and long-term leases – underpins the performance,” Smith said.
Even in times of downturn for other direct property investments, healthcare has held strong.
The Lonsec judges reinforced this, saying that the fund’s strong performance “was driven by the excellent growth profile of extending existing facilities and the development of new assets in established healthcare precincts”.
Another key strength of investing in this class of units for the Healthcare Property Trust has been its ability to maintain its liquidity.
“I think the option of having enough liquidity is quite important to them [older investors, such as selffunded retirees] and it helps them manage their cash as well. And with greater returns coming from the underlying assets,” Smith said.
He said that part of the secret to keeping up liquidity was holding “an admittedly large percentage” in cash.
The Healthcare Property Trust consistently has 20 per cent in cash.
Finalist Placer said that crucial to its NewActon East Property Fund’s success, which is invested in a property in Canberra, is the fact that it is “fundamentally a great property in a great location with great tenants”.
Smith also reinforced the importance of lessees to investment success in the direct property sector, saying that the fund enjoyed good relationships with its tenants.
Finalist AMP Capital pointed to location and diversity as drivers of its Wholesale Australian Property Fund’s strong returns.
Its annual performance of 8.02 per cent to the March quarter end beat the Australian Direct Property sector average by 5.84 per cent.
It sticks to offices, retail and industrial properties in major metropolitan centres for its investments, and also ensures that none of its 390-plus tenants account for more than five per cent of the fund’s revenue.