AMP Capital fund downgraded
The departure of key staff from AMP Capital's London office resulted in a ratings downgrade for the AMP Capital Property Securities Fund from a property-focused research house.
In a statement yesterday, SQM Research said the downgrade from 4.25 stars to four stars was a "direct result" of the departure of deputy head of global listed real estate Tom Walker.
"The departure of Mr Walker shadows from the earlier departures of Hugo Machin in early April 2014 and Nikita Johal in August 2013," said SQM.
"All departures were responsible for fundamental research in Europe, with no investment staff now intact in London following these departures," said the statement.
"SQM Research is concerned that the departures are a result of budget cuts incorporated throughout the broader AMP Capital organisation," it said.
Under SQM’s rating structure, four stars still indicates a ‘superior’ fund that is “suitable for inclusion on most [approved product lists]”.
Zenith Investment Partners reacted by placing the AMP Capital Property Securities Fund and the AMP Capital Listed Property Trust ‘under review’.
Speaking to ifa, Zenith analyst Jonathan Baird said the ‘under review’ rating was above a ‘redeem’ rating – but it indicates that investors should not be adding to their holdings.
Zenith has met with all three managers and held each in high regard, he said – but given Mr Walker’s seniority, his departure is “the most significant”, said Mr Baird.
“The three departures combined have resulted in the loss of the complete regional team, which adds to the magnitude of the changes,” he said.
“These departures have placed a heightened level of concern over not only the European team, but the broader team given the possibility of staff relocation,” said Mr Baird.
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