A few questions to Is there a range of property types in the fund? ask before you invest Does the fund have some cash reserves? in a property How does the fund manager plan to increase the value of their holdings? fund Does the fund manager’s company have the necessary resources? Does the fund meet your needs? Is it making the most of its properties? There are many property funds out there and their If most of a fund’s properties are occupied (in other names aren’t always that informative. However, you can words, it has a low vacancy rate) and its tenants are get an idea of the growth potential and risks by looking on longer leases, this means the fund is less likely to at the investments a fund makes and the company that experience a sudden drop in rental income. runs it. Equally, it’s good to check that the fund manager Where does the fund invest? is doing everything they can to maximise returns. A good place to start is to check how varied a fund’s For example, they could refurbish properties, change holdings are. This doesn’t just mean the number of planning use or improve their leases. properties it holds, it’s where they are located, what size Is the fund sensibly run? they are, how many tenants they have and what sectors they serve. When you put your savings in a property fund, you might expect all the money to be spent on buying properties – A broad spread of properties means a fund can cope after all, that is the point of the investment. However, a much better with a downturn in any one area – and well-run fund should hold some cash in reserve, so it is having lots of tenants means you aren’t relying on the ready to take advantage of new opportunities and can fortunes of just a few businesses. easily meet any withdrawals. What about the fund’s size and resources? At the most basic level, a larger fund is able to buy bigger properties – so it has more options to choose from. However, a well-resourced and highly experienced team also has more market knowledge and better access to opportunities. 9