The growing number of frozen funds
August 27, 2008
Whilst the listed infrastructure sector has been suffering a capital strike and going through tough times, at least investors can sell out and liquidate their exposure, albeit at huge capital losses with the likes of Babcock & Brown Power. The same can't be said for the myriad of unlisted investment opportunities which various promoters have deluged Australia's $1.4 trillion superannuation pool with over the past few years.
A crisis of confidence has caused an increasing number of these funds to freeze redemptions, so we've decided to track this disturbing trend through the following list:
AMP: froze withdrawals from its Capital New Zealand Property Fund in August after contagion engulfed the entire sector.
Axa: The French controlled insurance giant suspended redemptions by institutional investors from its Kiwi Mortgage Backed Bonds fund in August and has recently frozen its $1 billion Australian Property Fund.
Blackrock Australia: in August revealed that only periodic withdrawal offers would be accepted at its $600 million Combined Property Income fund. Two other Blackrock funds, Direct Property and Direct Real Estate, are also forcing clients to wait up to 18 months for redemptions.
Canterbury Mortgage Trust: a $250 million New Zealand fund which froze redemptions in July 2008.
Centro: froze redemptions on its open-ended unlisted Centro Direct Property Fund in December 2007. The fund was established in 2002 and provided investors with exposures to Australian shopping centres through CentroMCS syndicates.
Challenger: recently froze its Hybrid Property Fund.
City Pacific: froze redemptions on its $1 billion First Mortgage Fund in March 2008 after bad publicity generated a flood of requests. Distributions were also abandoned and the freeze has been extended until 12 months.
Guardian Mortgage Fund: another $200 million-plus New Zealand fund which froze redemptions in July after a run.
Macquarie Group: froze redemptions on its $1 billion Direct Property Fund in August.
MFS/Octaviar: the $700 million MFS Premium Income Fund was frozen in January 2008 after a major run.
Mirvac: on July 25, 2008, Mirvac announced a 6 month freeze on redemptions at three funds - Mirvac AQUA High Income Fund, Mirvac AQUA Enhanced Income Fund, and the Mirvac AQUA Income Fund.
Tower: closed its $242 million Mortgage Plus fund in New Zealand after a run in the first half of 2008.
A crisis of confidence has caused an increasing number of these funds to freeze redemptions, so we've decided to track this disturbing trend through the following list:
AMP: froze withdrawals from its Capital New Zealand Property Fund in August after contagion engulfed the entire sector.
Axa: The French controlled insurance giant suspended redemptions by institutional investors from its Kiwi Mortgage Backed Bonds fund in August and has recently frozen its $1 billion Australian Property Fund.
Blackrock Australia: in August revealed that only periodic withdrawal offers would be accepted at its $600 million Combined Property Income fund. Two other Blackrock funds, Direct Property and Direct Real Estate, are also forcing clients to wait up to 18 months for redemptions.
Canterbury Mortgage Trust: a $250 million New Zealand fund which froze redemptions in July 2008.
Centro: froze redemptions on its open-ended unlisted Centro Direct Property Fund in December 2007. The fund was established in 2002 and provided investors with exposures to Australian shopping centres through CentroMCS syndicates.
Challenger: recently froze its Hybrid Property Fund.
City Pacific: froze redemptions on its $1 billion First Mortgage Fund in March 2008 after bad publicity generated a flood of requests. Distributions were also abandoned and the freeze has been extended until 12 months.
Guardian Mortgage Fund: another $200 million-plus New Zealand fund which froze redemptions in July after a run.
Macquarie Group: froze redemptions on its $1 billion Direct Property Fund in August.
MFS/Octaviar: the $700 million MFS Premium Income Fund was frozen in January 2008 after a major run.
Mirvac: on July 25, 2008, Mirvac announced a 6 month freeze on redemptions at three funds - Mirvac AQUA High Income Fund, Mirvac AQUA Enhanced Income Fund, and the Mirvac AQUA Income Fund.
Tower: closed its $242 million Mortgage Plus fund in New Zealand after a run in the first half of 2008.