12 Dec 2017

Pricing mechanisms for open ended real estate funds is an important topic which has always generated much attention.

The open-ended fund pricing roundtable event, a joint initiative of AREF and INREV, was kindly hosted by UBS Asset Management. This followed on from the Munich event on 30th November.
Following an introduction from AREF’s CEO, John Cartwright, Nick Brown, M&G (Chair) gave an overview of the work done by the focus group involved in this initiative and guidance regarding the objective of the feedback sessions. Robert White, Partner at EY, then presented the research paper and modelling they had performed and posed a number of questions to kick off discussions.
The seven core questions addressed the following areas:

  • Types of pricing policies delegates have come across
  • Issues investors have raised regarding the pricing policies
  • Any trends that can be determined? for example, geographic or client type
  • Delegate's experiences regarding fund modelling their companies may have done?  
  • How difficult would it be to change pricing policy?

The full detail of questions can be found here.
Discussion was free-flowing and broadened to cover all areas the delegates considered relevant. Robert also posed further questions to gather feedback on matters such as historic vs forward pricing, what delegates thought of the idea of a dynamic pricing policy and questioned the rigidity of the dual-pricing model.
Our thanks again to all members of the focus group, EY for their modelling work, UBS for providing excellent facilities and for the enthusiastic participation and valuable contributions of all the delegates attending.
It has been a busy year at AREF regarding such events as this and it is our intention to make 2018 busier still, with thought-provoking and educational events throughout the year. We are kicking off the New Year with another roundtable event on Tuesday, 16th January, to discuss the potentially seismic changes in the Budget around capital gains tax. Please register early here, it is proving very popular.

Read more about the Open Ended Fund Pricing Project by visiting the project page, here.