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Malaysian Pension Fund Allocates $1.5Bn To Uk Property

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Malaysian pension fund allocates $1.5bn to UK property

Malaysia's first-pillar pension scheme, the Employees Provident Fund (EPF), has allocated $1.5bn to UK real estate in expectation of a long-term annual yield of 6-7%.

The EPF, with 12 million scheme members, is believed to be worth $112bn. It has asked ING Real Estate and Deutsche Bank subsidiary RREEF to source real estate assets in the UK. This represents the scheme's first indirect investment in overseas real estate. Property currently accounts for less than 1% of the scheme's total portfolio.

Since it was set up in 1991, the EPF has failed to diversify outside its home market in any asset class. Its global investment in equities accounts for less than 3%, for example. The largest allocation is to bonds (38%), with equities accounting for 32% and Malaysian government securities 24%.

However, EPF chairman Samsudin Osman has in recent months emphasised the need to diversify across asset classes, to ensure members receive a guaranteed annual dividend of at least 2.5%. The scheme posted investment returns in the first quarter 2010 of RM5.55bn ($180bn) – a 70% increase over the same period last year.

Azlan Zainol, chief executive at EPF, attributed the increase to "a more buoyant than favourable economic environment" as Malaysia "steers into making a full recovery "from the global economic and financial crisis. Property returns in the first quarter increased by 5% to RM21.67m compared with the same period in 2009.

Someone else finds uk property attractive.

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Previous quality Malaysian investments:

Bakun dam is another white elephant

Funding for the Bakun Dam project is mainly via borrowings from the Employees Provident Fund (EPF) and Kumpulan Wang Persaraan (KWAP); that amount has swelled to RM5.75bil, according to Sarawak Hidro chairman Tan Sri Izzuddin Dali.


Change WE Must and put a stop to these wastage of the nations money and natural resources

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If they buy it off the bank @ a cut down price for $ or £ then they make a killing over the next 25 years!


Exactly, they're talking commercial property (not 3 bed semis in Wandsworth) which has corrected 40-50% from the peak and probably close to bottoming out. Buy a repo'd development with Malaysian Ringgits at only 4.8 to the £ instead of 7 only 2 years ago and you've got yourself a 70% discount.

Now if only I could find a house at 70% off...... ;)

Edited by luigi
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Did a five month contract last year in Malaysia.

I feel very sorry for how poor they are and I guess they are going to be poorer when they retire then.

A dear friend who is malaysian always say's

"Malaysia Boleh!........Cos we can't"

Some Malaysian are poor but some are pretty silly rich actually...

YTL bought Wessex water few years back.

Search Paris Hilton & Jho Low for the 1 million euros champagne party.

Think this is abit like reverse take over... once upon a time Great Britain goes and take their lands. Now they are buying British lands and building.

Edited by easybetman
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This seems to be another case of what Jeremy Grantham described recently in which every sovereign wealth fund, endowment or even pension fund is following the example of Yale University and diversifying beyond the traditional equity / bond mix. Hence all the interest in commodities, hedge and VCT funds, and real estate.

The upshot according to Grantham is that top quality stocks are now very cheap as everyone has sold them off to buy into these other asset classes.

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  • 441 Brexit, House prices and Summer 2020

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