Financial Resource

Connaught Asset Management (CAM), supported by fund administrators Capita Financial Group (CFG), is launching their Series 3 fund today. CAM has been specifically created with a team of specialist investment professionals to construct strategic land funds. These funds cater for the institutional and sophisticated investor markets, using the professional services of their associate companies – Connaught Land and Connaught Consultancy Services.

CAM’s series 3 land fund replicates the success of their Series 1 and Series 2 diversified land managed fund – which is targeted to deliver a 15% annualised return over a 7 year investment period after all fees and expenses.

One of the attractions of these funds is that they are based on the investment potential of land sites for re-development at a time when there is a severe shortage of land in the UK to develop for residential and business purposes, combined with the Government setting targets of 3 million new homes to be built by 2020*.

The CAM team spent a year perfecting the fund structure and asset allocation to ensure that they are launching the best fund for the current market.

The funds will only purchase sites within the UK if there is a strong likelihood of obtaining change in their permitted planning use to generate an increase in the sites’ value – sites carefully identified and purchased by land planning, development and management experts Connaught Land. This could be, for example, a change from agricultural or redundant industrial use to residential or commercial use.

Each fund is designed to make land investment accessible to a wider range of investors, whilst keeping investment risk levels as low as possible through site diversification (to ensure the risk of a single site not performing to expectations is minimised), no gearing, constant managing and monitoring.

The fund will be offered as a UK limited partnership with an associated exempt unit trust for SIPP and SSAS investors. It is also available to invest via a number of offshore bonds. The minimum investment in the fund is £35,000 or the Sterling equivalent of 50,000 Euros, if higher. Profit from successful projects will be paid out during the term of the fund.

The fund will only be promoted through intermediaries and is due to close on 29th February 2008. It will be capped at £50m and offered on a first come first served basis.

The funds are operated via CFG, which is authorised under the Financial Services and Markets Act 2000 (FSMA) to act in the UK as the operator of an unregulated collective investment scheme and is regulated by the Financial Services Authority (FSA) in the conduct of its regulated activities.

Nigel Walter, Chairman at Connaught Asset Management, said: “We have been absolutely thrilled by the interest shown in our Series 1 and Series 2 Strategic Land Funds and we already have commitments from several substantial businesses and institutions to promote our Series 3 fund to clients. “The current market conditions of declining returns in the Commercial Property sector and increasing uncertainty in equities have proven to be an ideal time for Investment Specialists to look at alternative non-correlated asset classes. I firmly believe that land is an ideal diversifier for any investment portfolio.

In addition to Connaught Land every project we research will be managed by a top 20 Land and Planning specialist business and will then be independently assessed prior to purchase and throughout the project life. The latest HM Revenue and Customs Property Market Report predicts land inflation over the next five years will be 63% and with Central Government making house building a key priority over the next 20 years it is an ideal time to invest in our fund.”

”These low risk funds are designed to deliver capital appreciation with profits paid out to investors throughout the life of each fund.” Brian Primrose, Associate Director from Capita Financial Group, said:

”We are delighted to be the Operator and Administrator to the Series 3 Strategic Land Funds as it reinforces our desire to support the growth in the UK Investment funds industry and bring innovative new funds and asset specialist such as CAM to the market.”

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