September 19, 2018
Photo: Flickr.com (CC BY 2.0)

Redemptions, key departures, and under-performance may be fueling a growing exit queue in the UBS flagship real estate fund

A new report from UNITE HERE examines recent redemptions, staff departures, and under-performance of the UBS Trumbull Property Fund.

Read the full report here

Key Issues:

  • Since 2017, LPs have sought redemptions of over $1.3 billion from the UBS Trumbull Property Fund (“TPF”), according to public documents.
  • As of December 2017, the UBS-TPF faced a redemption queue of $1.18 billion; at that time the entry queue was reported to be $0.
  • In March 2018, the exit queue was reported to be $383 million while the entry queue $124 million.
  • LP documents show that UBS TPF lost a net total of 31 investors between June 2017 and April 2018.
  • UBS has reported staffing changes including the retirement of Lead Portfolio Manager Kevin Crean and Assistant Portfolio Manager Steve Olstein.
  • UBS-TPF performance has trailed the NFI-ODCE benchmark in 9 of the past 10 quarters

Limited Partner Questions for UBS:

  • What is the current value of the redemptions in the queue?
  • What is UBSs policy on selling properties to fund redemptions?
  • How does Trumbull Fund plan to fund the current queue and future redemptions if the queue grows?
  • How was the approximate $800 million reduction in the exit queue between December 2017 and April 2018 funded?
  • How will UBS ensure a smooth transition as the TPF team loses to senior portfolio managers?
  • Is UBS Realty currently on watch for performance and staff change issues?