JPMorgan Global Core Real Assets Ld Capital Call and Portfolio Update (6048D)
March 04 2022 - 2:00AM
UK Regulatory
TIDMJARA TIDMJARU TIDMJARE
RNS Number : 6048D
JPMorgan Global Core Real Assets Ld
04 March 2022
JPMORGAN GLOBAL CORE REAL ASSETS LIMITED
Capital Call and Portfolio Update
Legal Entity Identifier: 549300D8JHZTH6GI8F97
Capital Call
JPMorgan Global Core Real Assets Limited (the 'Company' or
'JARA') is pleased to announce that $11.1m of the Company's
committed capital has been called and funded into the US Real
Estate Mezzanine Debt strategy. This investment will take JARA to
being effectively 100%(1) invested and was funded from its cash
balance and by reducing the liquid real asset allocation portion of
JARA's portfolio.
This investment will provide JARA with exposure to a portfolio
of 15 existing loans with a bias towards multifamily and office
loans. The weighted average duration of the portfolio of loans is
2.7 years. At full investment and with the addition of the
Mezzanine Debt strategy, the Company will have positively increased
its sensitivity to rising interest rates, given the Mezzanine
strategy's 64% exposure to floating rate loans. This allocation
will also help to increase JARA's portfolio income as the
underlying Mezzanine strategy has provided an income of 7.4% over
one year and an annualised return of 6.9% since inception(2) .
Target total returns for the Mezzanine strategy are 7-9% gross and
6-8% net(3) , this return will be primarily income orientated.
In 2021 commercial real estate markets were on a very positive
path. Investment sales volumes were strong, debt flows remained
high, and core real estate equity returns climbed to approximately
20% for the full year. Core real estate mezzanine debt benefits
from these strong underlying fundamentals and continues to offer an
attractive relative value to other fixed income investment products
seeking similar current income return.
The funding has changed JARA's asset allocation, which, based on
its exposures as of its last NAV (30th November 2021) are as per
below. Updated exposure details including more granular sector and
currency exposures will be released alongside JARA's next NAV which
should be available in due course. The impact of this recent
allocation to JARA's portfolio yield will be effective from
April.
Total Private Asset Public Asset
Exposure Exposure Exposure
Real Estate Equity 47% 38% 9%
Real Estate Debt 8% 4% 4%
Infrastructure 23% 17% 6%
Transportation 21% 18% 3%
-------------------- ---------- -------------- -------------
Total 100% 77% 22%
As at 25th February 2022. Numbers may not sum due to
rounding.
Portfolio Update
The Manager would like to highlight that JARA's portfolio and
its underlying strategies are performing as expected and JARA's
portfolio is not directly exposed to Ukrainian or Russian assets,
either on a NAV or income basis. The Manager believes that the
global geographic and asset level diversification, coupled with the
core nature of the portfolio assets and exposure to non-sterling
assets, means JARA is well positioned to weather the current
volatility.
The current market and political volatility, added to what was
already an inflationary environment, is focusing investors' minds
on robust defensive strategies that combine both reliable income
and opportunities for capital growth. JARA has delivered strong NAV
total returns since its portfolio has been near fully invested and
recent events, both geopolitical and macro in nature, serve to
underscore the attractiveness of JARA's differentiated offering and
attractive risk / return value proposition. The addition of the
Mezzanine strategy should further bolster this mix and shows the
flexibility of the JPM platform in being able to adapt to changing
market conditions.
(1) c.1% of capital remains uninvested for cost and liquidity
requirements
(2) Mezzanine Strategy inception 5th December 2019
(3) The difference between Net and Gross return is due to management fees levied
4th March 2022
Alison Vincent
JPMorgan Funds Limited - Company Secretary
Telephone 0207 742 4000
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