The board of directors of Bluerock’s Total Income+ Real Estate Fund (tickers: TIPRX, TIPPX, TIPWX) announced its recommendation to engage RREEF America as sub-advisor on the publicly traded securities investments of the TI+ institutional real estate portfolio.
RREEF, which has a 40-year investment heritage as a manager of public and private real estate assets worldwide, currently manages $50-plus billion in assets for more than 465 institutional clients globally. It is part of Deutsche Asset and Wealth Management, one of the 10 largest bank-owned asset managers across the globe with one trillion dollars of assets under management.
“As our fund approached the $200 million [assets under management] threshold, we undertook an extensive search for a sophisticated manager with a deep investment team and strong, market-leading track record for the public real estate securities portion of our portfolio. In RREEF, we found one of the largest and most sophisticated real estate investment teams across the globe. Significantly, RREEF had the ability to build and execute a bespoke investment strategy customized to TI+ investment parameters, rather than utilizing an off-the shelf strategy being used by other clients, which was important to us,” said Ramin Kamfar, Bluerock’s chief executive officer.
If approved, RREEF will be responsible for recommending the fund’s public real estate securities investments, which are generally targeted to comprise approximately 20 percent of the TI+ portfolio. The fund will also look to RFEEF to provide enhanced trading capabilities and wider investment options. RREEF’s global focus would also enable the fund to make tactical global investments to complement the fund’s majority U.S.-focused strategy.
According to the company, all sub-advisory fees are borne by the fund advisor, therefor the investors in the fund will not have to absorb the cost of engaging RREEF.
Mercer Investment Management will remain in its current roles as sub-advisor on the fund’s private real estate investments and as sub-advisor on the fund, overall.
The board of Bluerock’s Total Income+ Real Estate Fund, in conjunction with Bluerock Fund Advisor and Mercer, says that it evaluated multiple potential sub-advisors for the new role. Criteria included a deep and broad investment team, investment capabilities across multiple markets, a strong historical investment track record, the ability to deliver a customized investment strategy for the fund, as well as an ability to generate strong risk-adjusted returns with relatively low volatility across market cycles.
The board will hold a special meeting of its shareholders at the offices of Gemini Fund Services to vote on the addition of RREEF as sub-advisor to the fund on January 28, 2016, and will, pending approval, engage RREEF in Q1 2016.
The fund closed the quarter as of September 30, 2015, with an inception-to-date, annualized total return of 8.94 percent (Class A shares, excluding sales load and an inception-to-date, annualized total return of 6.76 percent (Class A shares, with load). The fund’s one-year, annualized total return as of September 30, 2015 was 7.13 percent (Class A shares, excluding sales load) and 0.96 percent (Class A shares, with load). The maximum sales charge for Class A shares is 5.75 percent.