Ivy Funds Adds New Choices for Global Real Estate Investors
Introduces Ivy Global Real Estate Fund and Ivy Global Risk-Managed Real Estate
OVERLAND PARK, Kan. -- April 1, 2013
Effective today, Ivy Funds launches two new global funds to help investors and
financial advisors pursue the potential opportunities of investment in real
estate securities: Ivy Global Real Estate Fund and Ivy Global Risk-Managed
Real Estate Fund.
Ivy Global Real Estate Fund will seek to provide total return through
long-term capital appreciation and current income. The Fund is anticipated to
maintain a risk profile similar to that of the broader global real estate
securities market. The Fund typically will invest in the equity securities of
companies in both core property sectors (such as office, retail, multi-family
or industrial), and specialty sectors (such as hotel, home building or other
real estate). The Fund will invest in securities offered by companies active
in real estate ownership, development, and investment management.
Ivy Global Risk-Managed Real Estate Fund also seeks to provide total return
through long-term capital appreciation and current income. The Fund is
anticipated to pursue a lower risk profile than the broader global real estate
securities market. The investment team will seek to manage risk by focusing on
the securities of companies they consider to have lower leverage, lower
business risk and/or lower-risk property types. Typical investments will focus
on companies investing in the core property sectors. The risk-screening
process represents an important difference between the two Funds. The
portfolio management team generally will exclude companies from the investment
*have high financial leverage (greater than 45-50%);
*have substantial exposure to what are considered non-core asset types
(such as hotels and home-building companies);
*have significant exposure to non-earning assets;
*have significant exposure to ancillary activities such as merchant
building or investment management.
The new Ivy Funds seek to provide investors with exposure to high-quality,
professionally managed global real estate with the added potential benefit of
active management that seeks to identify securities offering an attractive
combination of risk and return.
The new funds are subadvised by LaSalle Investment Management Securities, a
well-known real estate securities investment manager.
“The global real estate sector provides investors another avenue to pursue
diversification and income potential,” said Thomas W. Butch, president and CEO
of Ivy Funds Distributor, Inc. “Part of our ongoing strategy is to ensure that
Ivy Funds continue to offer a range of options that best align with investor
needs. With LaSalle, we’re fortunate to partner with one of the foremost names
in global real estate securities in support of this objective.”
There is recent evidence of strong investor interest in this asset class.
Open-end real estate fund flows in 2012 of $15 billion were nearly double
those of 2011, and in just the first two months of 2013 they reached $6.5
billion, surpassing flows for the entire year of 2010, according to data from
Both funds will invest primarily in the equities and equity-related securities
of global real estate companies, including real estate investment trusts
(REITs) and real estate operating companies (REOCs). They typically will
invest at least 80% of net assets in the real estate or real estate-related
industries, and will not invest directly in real estate. The Funds typically
will invest at least 40% of total assets in securities of issuers outside the
Keith Pauley CFA, Managing Director and CIO at LaSalle, said, "We are excited
to join forces with Ivy Funds to provide investors with new choices to
participate in the growing global real estate securities markets. Real estate
securities are an efficient way for investors to participate in global real
estate. The new funds will provide investors alternative strategies for
participating in global real estate based on their risk and return
Among other potential benefits, real estate securities can provide additional
diversification in a portfolio because they are not highly correlated with
other global asset classes. They also can provide another choice for investors
seeking income from their investments, especially in the current environment
of historically low interest rates.
The portfolio management team includes Mr. Pauley, who has 27 years in the
industry and 27 years with the firm; Stanley J. Kraska, Jr., 27 years in the
industry and 25 years with the firm; George J. Noon, CFA, 25 years in the
industry and 23 years with the firm; and Ernst-Jan de Leeuw, based in
Amsterdam, who has 17 years in the industry and 12 years with the firm.
LaSalle was established in 1985 and is one of the most experienced investors
in real estate securities. Based in Baltimore, MD, LaSalle has nearly 60
employees based there and in regional investment and analytical offices
located in Amsterdam and Hong Kong. It has $10 billion of assets under
management in listed real estate securities (as of Jan. 31, 2013) and is
affiliated with LaSalle Investment Management, one of the leading
institutional investors in real estate worldwide. Both are part of Jones Lang
LaSalle (NYSE: JLL). With more than 45,000 employees operating in 1,000
locations across 70 countries, Jones Lang LaSalle focuses solely on real
estate and is one of the world’s largest property services companies.
Ivy Funds, with approximately $53 billion in total assets under management at
Dec. 31, 2012, offers a broad fund lineup covering all major asset categories,
including international and domestic equity funds, specialty funds, fixed
income funds and money market funds.
Ivy Funds Distributor, Inc. is an affiliate of Waddell & Reed Financial, Inc.
(NYSE:WDR). Through its subsidiaries, Waddell & Reed Financial, Inc. provides
investment management and financial planning services to clients throughout
the United States. The firm had total assets under management of approximately
$96 billion at Dec. 31, 2012. Ivy Investment Management Company serves as
investment advisor to the Ivy Funds. Ivy Funds Distributor, Inc. serves as
principal underwriter and distributor to the Ivy Funds.
Investors should consider the investment objectives, risks, charges and
expenses of a fund carefully before investing. For a prospectus, or if
available, a summary prospectus, containing this and other information for any
of the Ivy Funds, call your financial advisor or visit www.ivyfunds.com.
Please read the prospectus or summary prospectus carefully before investing.
Past performance is not a guarantee of future results. Diversification does
not guarantee a profit or protect against loss in a declining market. It is a
method to manage risk.
Risk factors. As with any mutual fund, the value of the Funds’ shares will
change, and you could lose money on your investment. Investment risks
associated with investing in real estate securities, in addition to other
risks, include rental income fluctuation, depreciation, property tax value
changes and differences in real estate market values. Because the Funds invest
more than 25% of their total assets in the real estate industry, the Funds may
be more susceptible to a single economic, regulatory, or technical occurrence
than a fund that does not concentrate its investments in this industry.
International investing involves additional risks, including currency
fluctuations, political or economic conditions affecting the foreign country,
and differences in accounting standards and foreign regulations. These risks
are magnified in emerging markets. The Funds are non-diversified, meaning that
they may invest a significant portion of their total assets in a limited
number of issuers, and a decline in value of those investments would cause the
Fund’s overall value to decline greater than that of a more diversified
portfolio. Regarding Ivy Global Risk-Managed Real Estate Fund, there is no
guarantee that the fund will not decline in value in comparison with funds
that do not use a risk-managed approach. These and other risks are more fully
described in the Funds’ prospectus. Not all funds or fund classes may be
offered at all broker/dealers.
The Funds are subadvised by LaSalle Investment Management Securities, LLC,
which delegates to its affiliate, LaSalle Investment Management Securities,
B.V., for portfolio management responsibilities of the Funds’ assets allocated
to European investments. References to LaSalle include both entities.
Ivy Funds Distributor, Inc. PRI10607 (04/13)
Ivy Funds Distributor, Inc.
Roger Hoadley, 913-236-1993
VP, Director of Communications
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