ING Real Estate Income Fund
AustraliaING Real Estate Income Fund launched in April 2005 and provides investors with exposure to a diversified portfolio of properties across four different property sectors.
The fund holds units in the following four ING Real Estate property trusts:
- ING Industrial Fund.
- ING Office Fund.
- ING Real Estate Entertainment Fund.
- ING Retail Property Fund Australia.
Suspension of Quarterly Distributions
Effective from 22 December 2008, the quarterly distributions to investors have been suspended.
Reductions in the forecast future income distributions of the A-REITs in which the Fund invests have materially reduce the Fund's income. As a result, distributions from the Fund have been suspended in order to use the cash to meet the interest expense on Fund borrowings.
Fund Unit Price
The unit price of the Income Fund at 30 June 2009 is $0.00 per unit (zero). The unit price of the Fund has declined due to the drop in the ASX market prices of ING Industrial Fund, ING Office Fund and ING Real Estate Entertainment Fund.
A comparison of the acquisition price of the Income Fund’s investments in 2005 and their value at 30 June 2009 is as follows:
| Investment | Target initial allocation (31 March 2005) | Unit Price (31 March 2005) | Unit Price (30 June 2009) |
|---|---|---|---|
| ING Industrial Fund | 35% | $2.03 | $0.25 |
| ING Office Fund | 35% | $1.22 | $0.46 |
| ING Retail Property Fund Australia | 25% | $1.24 | $1.30 |
| ING Real Estate Entertainment Fund | 5% | $1.12 | $0.15 |
| Unit price of Income Fund | 100% | $1.00 | $0.00 |
The comparison also shows the unit price of the Income Fund at inception was $1.00 per unit. The unit price has declined to $0.00 at 30 June 2009 as the Income Fund is a geared fund. The value of the Income Fund’s investments at 30 June 2009 was approximately $6.6 million while Fund borrowings are $10.5 million. Investors in the Fund are not liable for the current shortfall in the value of the Fund’s assets compared with its borrowings.
The fund is closed to new investors.