Investors hoping for a “Santa Claus” rally in December to cap off a dismal year were disappointed, with global indices falling between -4% and -6%. A range of negative forces dominated 2022, namely aggressive interest rate hikes to curb inflation, recession fears, the Russia-Ukraine war and rising concerns over rising CV-19 cases in China. 2022 was the worst-performing calendar year since 2008, with equity markets off between -15% and 19%.
The Atlas High Income Property Fund declined -1.1% in December in a broad-based sell-off for real estate assets that saw the wider Listed Property market fall -4% over the month to cap off a -20.5% decline for the 2022 calendar year.
Over the past year, the share prices of the developers declined the most as investors realised that one-off profits and revaluation gains are likely to evaporate in tougher markets. As such, it is not too smart to value this variable source of income at 30 to 40 times! The Atlas Fund has consistently avoided developers in favour of trusts offering consistent, reliable and forecastable income streams.
The Fund declared a quarterly distribution of $0.031 per unit for the December Quarter, a small increase from September’s distribution. The distribution was paid to investors in early January.
Go to Monthly Newsletters for a more detailed discussion of the listed property market and the fund’s strategy going into 2023