Fund Review
The fund posted a 16% negative gross total return (USD) but outperformed the benchmark by about 1%. However, in rand terms the fund posted a flat return thanks to the rand that weakened from 6.76 to 8.10 to the dollar during the quarter. The biggest contributors to outperformance were our European and Australian stock picks. The best performing sectors were residential, diversifieds and retail. Hotels, industrials and offices posted inferior returns. The fund's top five biggest overweight positions are: Simon Property Group, Unibail-Rodamco, Digital Realty Trust, Prologis and Westfield Group. This is in line with our strategy to invest with high conviction in property companies that have exposure to prime properties, tenant stability, balance sheet strength and core rental earnings.

Market Review
The quarter was characterised by huge volatility driven by global recession and debt concerns. As a result the UBS Global Investors Index lost 16.5% in USD terms. All the regions posted negative total returns. Rental markets across all sectors are still showing positive growth but off a low base of 2009.

There is a marked gap with prime (A-grade) and secondary (B-grade) properties across the world. The gap between the pricing (yield) of these assets is almost at record levels. There is continued demand for prime assets across all markets. Investors are hunting for quality and stable income and are prepared to pay a premium for these. Banks are sitting with distressed assets and continue to try to offload them. The biggest challenge with secondary assets is access to funding.

Vacancies are falling off the peaks achieved in 2009. Overall, the number of new building plans passed and buildings completed has come down sharply. This bodes well for existing properties in the medium to long-term.

Looking Ahead
The global listed property sector is now looking attractive both on a yield and NAV basis. We are forecasting a 5.1% one-year forward yield. This is comfortably ahead of cash and bonds. After the recent sell-off, the sector is now trading at a discount to NAV of 13% (compared to 3% premium at the beginning of the quarter) i.e. listed property is now cheaper than physical property. Lower volatility relative to equities also makes a case for investing in global listed property. The biggest risk for the sector is a recession leading to lower than expected rental growth, debt concerns and global markets volatility

Fund Review
The fund delivered a strong ZAR gross total retum of 4.3% for the quarter. This was fairly in line with the benchmark. The positive contributors to the performance were the US, Canada and Sweden underweight positions. Our marginal underweight to Great Britain, Japan and our overweight position in Singapore dragged down our performance. Sectorally, the fund performance was boosted by our overweight position in office focused stocks and underweight positions in retail and diversifieds. Our underweight calls in hotels and industrials pulled down our performance. A week before the end of June, the fund participated in a private placement by NEPI, a Romanian retail focused stock. By end of June the fund had made a capital retum of 11 %. This was the biggest contributor to performance for the quarter.

Market review
Global listed property has performed phenomenally well and has posted a ZAR total return of 12.5% year-to-date. Despite such a great return, all regions are still trading at a discount to the bond market on a yield basis, thanks to strengthening bond yields. The US offers the lowest yield (3.2%) and discount, whereas regions like Singapore, Japan and Australia offer yields of over 4 % and a higher discount to bond yields. On a NA V basis, the sector is trading at a premium of 4%. However, NAV is projected to grow by over 5% over the next year. The office sector, our most preferred bet, has been doing well across most major nodes in all regions. Rental growth is accelerating in nodes like Manhattan (New York), Hong Kong, Paris, Singapore, Central London and West End London. Tokyo appears to have reached the bottom. The positive rental growth has been aided by a sharp decline in new completions and declining vacancies more so in the prime
nodes. There is a lot of demand for property investment globally.

Looking Ahead
We are looking for the fund to deliver a yield of 3.7% in USD over the next year. The fund provides diversification across currencies, regions and sectors. The main catalyst for positive returns is continued economic growth. There is a strong correlation between GDP growth and earnings growth. Fundamentals have improved across all regions and sectors, more so in the office space. Physical property valuations have reached the trough - this has been aided by limited supply of new properties. The risk remains in higher inflation leading to interest rate hikes, lower than expected economic growth and US and European debt concems.

Fund Review
The STANLIB Global Property Fund slightly outperformed the benchmark by 10 basis points on a gross USD total return basis for the quarter. The slight overweight allocations to Singapore and Hong Kong, and stock selection in Europe region had a negative impact on performance. Good stock selection in North America and the underweight allocation to Japan made a positive contribution to performance. We maintained our overweight position in Digital Realty Trust during the quarter and this paid off as the stock came back strongly and made the single biggest contribution to attribution overall. We maintain our overweight in Alstria Office REIT, an office focused REIT in Germany, which saw its share price decline during the quarter in line with an equity raising by the company. Kenedix Realty Investments was the biggest detractor to attribution. We however increased our overweight position in Kenedix after it was oversold on the news of the disasters in Japan.

Market Overview
The Global Investors Index returned 5.5% for the first quarter 2011 on a USD total return basis. Investors outperformed Developers by 10.5% over the period. Continental Europe (8.9%) was the best performing region followed by the UK (8.7%), North America (6.9%) and Australia (4.5%). Japan (-8.2%) was the worst performing region followed by Hong Kong (-1.6%) and Singapore (-1.6%).
Europe had a strong performance coming of a low base from Q4 2010 and outperformed despite a flare-up of sovereign debt concerns during the quarter. Gecina was the best performing stock driven by surprising strength in the Paris residential market. GAGFA a large residential investor in Germany was the worst performing stock facing a potential $1.5Bn lawsuit involving the City of Dresden.
Strong UK performance was underpinned the strong fundamentals particularly in the Central London office market and regional shopping centres. Segro, a large owner of industrial properties in UK and Europe was among the best performers.
North America as a region slightly outperformed with Canadian listed property like Boardwalk Real Estate Trust and Riocan REIT among the top performers. Real estate fundamentals continue to improve in the US. Lack of new supply and improved economic data bode well for the sector.
Australia slightly underperformed with Charter Hall Office REIT the best performing and Astro Japan Property Group the worst performing. With an average dividend yield around 6% the region looks attractive on a relative global basis.
Asia underperformed significantly with Japan coming off a high base from Q4 2010. The recent earthquake and tsunami added to the underperformance.

Looking Ahead
We are forecasting a yield of about 3.8% (USD) in the next year. The positive catalyst for the sector is sustained global economic recovery. The downside risks for the sector lie in higher inflation leading to interest rate hikes. We believe that exposure to the fund offers diversification from offshore cash, equities and bonds. It acts as a rand hedge too.

Fund Review
The fund outperformed the benchmark in the fourth quarter. Our positions in Oceania (Australia and New Zealand) Hong Kong, UK and Europe were positive for the fund. We were however, hurt by North America, Singapore and Japan calls. Outperformance by retail-focused stocks like Euro commercial and Deutsche Euroshop Stocks contributed positively to our European exposure. We had an underweight position in the UK, but our overweight position in British Land paid off. Our overweight position in Hong Kong, and Hong Kong Land, an office landlord, was positive for the fund. The negative effect of our overweight position in Singapore was countered by the strong performance of Mapletree Logistics. Our positive bet in Cromwell Group, a defensive government-tenanted office portfolio, combined with a stronger Australian dollar added to outperformance. The underallocation to Japan was negative for the fund. The North America bet did not work well with our biggest holding, Simon Property Group, a dominant retail-focused company, trading sideways during the quarter.

Market Overview
The driver of good returns was improved property fundamentals which led to a recovery in real estate values. The other key factor was the global search for higher yields due to the current low interest rate environment. Hong Kong was the best performing region supported by very strong office rental growth, higher GDP increase and mainland China shoppers. Hong Kong was followed by Japan, US, Europe and Singapore. The worst performing region was Australia followed by the UK. Japan listed property prices were up strongly driven by the announcement that Bank of Japan will be buying JREITS (property stocks). Despite Singapore being Asia's fastest growing economy, it underperformed during the quarter. However, fundamentals remain strong, particularly in the office space. The opening of casinos will boost tourist arrivals. This is expected to support the retail sector. Europe performed well but has been very volatile due to sovereign debt problems in the regions. A weaker Euro boosted countries like Germany. UK property capital values improved during 2010 but the momentum is expected to slow in 2011. West-end retail and the central London office market are the strongest nodes. After the interest rate hikes, Australia has seen slowing retail sales, house prices and leasing activity, but earnings are expected to bottom out in 2011. The US listed property market continued to perform well, beating the broader equity market, with the biggest driver being the low interest rate environment.