Report - Nikko AM Asia Limited

SEMI-ANNUAL REPORT 

For the financial period ending 31 December 2013 

Nikko AM Shenton 

Global Property Securities Fund 

1

MANAGERS 

Nikko Asset Management Asia Limited 

8 Cross Street PWC Building #08-01 

Singapore 048424 

Company Registration No. 198202562H 

DIRECTORS 

Charles John Sherard Beazley 

Frederick Reidenbach 

Blair Chilton Pickerell 

Lim Say Boon 

V Arivazhagan 

Seet Oon Hui Eleanor 

TRUSTEE & REGISTRAR 

BNP Paribas Trust Services Singapore Limited 

20 Collyer Quay, #01-01 Tung Centre 


AUDITORS 

PricewaterhouseCoopers LLP 

8 Cross Street, #17-00 PWC Building 


SOLICITORS TO THE MANAGERS 

Allen & Gledhill LLP 

One Marina Boulevard, #28-00 


SOLICITORS TO THE TRUSTEE 

Tan Peng Chin LLC 

30 Raffles Place, #11-00, Chevron House 


CUSTODIAN 

BNP Paribas Securities Services, Singapore Branch 



This report is also available on our website (www.nikkoam.com.sg) 

1

PERFORMANCE SUMMARY 

Since 

Returns (%) 3 Mth 6 Mth 1 Yr 3 Yr 5 Yr Inception 

Benchmark 1 -0.38 -0.53 6.20 8.14 9.22 9.94 

Nikko AM Shenton Global Property 

Securities Fund (S$) 2 -0.76 -1.62 3.42 5.40 11.05 0.70 

Source: © 2013 Morningstar, Inc. & Nikko Asset Management Asia Limited, returns as at 31 December 2013. Returns are calculated 

on NAV-NAV basis, SGD, and based on the assumption that all dividends and distributions are reinvested, if any. Returns for period 

in excess of 1 year are annualised. 

Since 


Benchmark 1 -0.38 -0.53 6.20 8.14 9.22 9.94 


Securities Fund (S$) 2 -5.72 -6.54 -1.75 3.61 9.91 0.11 


on a NAV-NAV basis, SGD, and based on the assumption that all dividends and distributions are reinvested, if any, and take into 

account of maximum sales and realisation charges. Returns for period in excess of 1 year are annualised. 

Since 


Benchmark 1 -0.99 -0.08 2.74 8.67 12.14 13.87 


Securities Fund (US$) 2 -1.31 -1.08 0.05 5.89 14.03 3.81 


on NAV-NAV basis, USD, and based on the assumption that all dividends and distributions are reinvested, if any. Returns for period 


Since 


Benchmark 1 -0.99 -0.08 2.74 8.67 12.14 13.37 


Securities Fund (US$) 2 -6.24 -6.02 -4.96 4.09 12.86 3.20 


on a NAV-NAV basis, USD, and based on the assumption that all dividends and distributions are reinvested, if any, and take into 


Inception Date: 11 April 2005 

Note: 

(1) The Fund’s benchmark is the UBS Global Real Estate Investors Total Return Index. Prior to 1 March 

2010, the benchmark was Yield Component of UBS Global Real Estate Investors Total Return Index. 

Prior to 1 April 2006, the benchmark was the UBS Global Real Estate Investors Total Return Index. 

(2) With effect from 17 October 2011, the Fund (formerly known as “DBS Global Property Securities 

Fund”) has been renamed as Nikko AM Shenton Global Property Securities Fund. 

There was an interim dividend of S$0.55 per 100 units held as of 31 December 2013. For the reinvestment 

of dividends, equivalent units will be created on the payment date 15 January 2014 for both the SGD 

and USD classes. 

2

Portfolio Review 

Underperformed during the period under review 

During the six months under review, the Nikko AM Shenton Global Property Securities Fund (the “Fund”) 

delivered a return of -1.62% (SGD terms, on NAV-NAV basis), underperforming its benchmark by 109bps. 

Stock selection in Hong Kong and Europe also contributed negatively. Particularly in Europe, the Fund 

underperformed as the exposure is in high quality names and some peripheral countries staged a strong 

rally. Underperformance was mitigated by underweight allocations in US and Canada, and Australia. 

Market Review 

Global property stocks declined for the six-month period 

Global property stocks fell during the six months to December 2013, with the EPRA/NAREIT Global 

Index declining 1.0% in USD terms. Stocks in Europe gained, while those in the Asia-Pacific region and 

Americas lagged. 

US property stocks fell despite improving macroeconomic data 

U.S. property stocks fell 5.6% during the period under review in USD terms, according to the FTSE EPRA/ 

NAREIT US Index. On economic news, macroeconomic data continued to show improving conditions. 

The December Preliminary Manufacturing PMI Index had increased to 55, higher than both prior data of 

54.7 and expectations of 54.4; while weekly jobless claims fell by 2,000 to 339,000 in the period ended 

December 28, lower than its median forecast of 344,000 claims. On notable company news, Empire State 

Realty Trust launched its USD 1bn IPO while Brookfield Property Partners offered to buy the remaining 

shares of Brookfield Office Properties for USD 5bn. Also, Essex Property Trust and BRE Properties signed 

a definite agreement under which BRE Properties will combine with Essex to create a West Coast pureplay 

multifamily REIT. Meanwhile, Simon Property Group announced that it plans to spin off all of its strip 

center business and smaller enclosed malls into an independent, publicly traded REIT. 

European property stocks gained on supportive measures by the European Central Bank (ECB) 

European property stocks surged during the six months to December, with the FTSE EPRA/NAREIT 

Eurozone Index up 12.4% in USD terms. The ECB continues to take steps to support sovereign bonds 

and its repeated interventions seem to have abated the crisis in Europe. Although structural issues need 

to be resolved, markets have given policy makers a breather. On economic news, the Eurozone consumer 

confidence index rose from -15.4 to -13.6 in December, the highest level since July 2011. Meanwhile, 

the Swedish Riksbank reduced the base interest rate by 25bps to 0.75% and the ECB cut rates to 0.25% 

in a push for growth. On company news, Klepierre signed a memorandum, led by Carrefour, for EUR 

2.01bn for its proposed disposal of a portfolio of 127 Carrefour-anchored retail galleries to a consortium. 

Furthermore, Deutsche Wohnen announced an all-share public exchange offer for GSW, which will 

create the largest German real estate company. 

UK property stocks surged on positive economic data 

UK property stocks gained 21.3% in USD terms during the period under review, as measured by the 

FTSE EPRA/NAREIT UK Index. On economic news, Consumer Price Index year-on-year (YoY) dropped in 

November to 2.1% from 2.2% in October. On the contrary, Halifax house prices showed a continuing 

uptrend, rising 1.1% month-on-month (MoM) or 7.7% YoY in November. IPD capital growth increased 

0.9% MoM in November led by Industrial (1.6%) while Retail lagged (0.4%). On notable company 

news, Hammerson sold its 50% stake in Queensgate Shopping Centre in Peterborough for GBP 202m 

to Invesco reflecting a 6.4% yield and producing an ungeared internal rate of return of 16.1% since the 

initial purchase in June 2012. Meanwhile, British Land JV Partner Blackstone has agreed to sell its 50% 

stake in Broadgate for GBP 1.7bn to Singaporean sovereign wealth fund GIC. 

Japanese property stocks climbed on strong retail sales and industrial production 

Japanese property stocks climbed 12.7% in USD terms during the half-year, according to the FTSE EPRA/ 

NAREIT Japan Index. On economic news, retail sales were strong in November; growing 4.0% YoY 

and 1.9% MoM, and we expect it to remain strong ahead of the consumption tax increase. Industrial 

3

production index increased 0.4% MoM and 5.4% YoY in November according to preliminary data. 

Also, Tokyo office vacancy dropped to 7.34% at the end of 2013, the lowest since August 2009. On 

company news, Mitsubishi Estate Co. Ltd. paid GBP 90m for Clive House, a London office building. 

Among notable offerings, GLP Japanese REIT (J-REITs) successfully raised JPY 23bn and the Japan Retail 

fund successfully raised JPY 38bn in a secondary offering to buy assets. 

Asia-Pacific property stocks traded lower in the six-month period 

Australian REITs (A-REITs) fell 4.6% in AUD terms during the period, according to the S&P/ASX 200 

A-REIT Index, while Hong Kong lagged behind with a decline of 3.9% in HKD terms, as measured by the 

Hang Seng Property Index, followed by Singapore property stocks also falling, losing 2.2% in SGD terms. 

In Australia, the Reserve Bank of Australia had reduced its cash rate by 25bps to a record low of 2.5%. 

On other developmental news, Westfield Group announced it sold seven non-core malls for USD 1.6bn 

and it will merge its businesses in Australia and New Zealand with Westfield retail Trust to form a new 

entity to be known as Scentre Group. Meanwhile, Dexus Property Group and GPT Group are in the midst 

of making a cash and script offer for the board of Commonwealth Property Office Fund. Elsewhere, in 

China, new home sales remains brisk, defying the traditional year-end lull despite a number of secondtier 

cities had reinforced their property tightening measures in view of a property share price correction. 

In Hong Kong, new home prices eased in the last 2 months of the period under review following brisk 

new home sales, driven by significant discounts offered by developers. On the contrary, Singapore’s new 

private home sales were volatile following its four-year low in July after the government announced 

that new permanent residents will have to wait three years before being allowed to buy a Housing 

Development Board flat from the resale market. 

Outlook / Portfolio Strategy 

US economic data remains skewed to the positive 

The US economic data continues to remain skewed to the positive. Notably, the economy continues to 

add jobs and the unemployment rate has fallen below 7.0%, the lowest reading since November of 

2008. In addition, continuing strength in the housing and equity markets, combined with tame inflation, 

are boosting confidence in the economic recovery. From a monetary perspective, we expect the US 

Federal Reserve to taper but expect the policy to be fairly accommodative from a historical perspective. 

We have continued to position the portfolio in stocks that are likely to benefit most from an improving 

economic backdrop and are less affected by the potential for rising rates in the US. In Canada, we 

continue to see a challenging REITs market due to rising interest rate and low organic growth, and keep 

our positive bias in the US. 

Continue to be pessimistic about Southern Europe vis-à-vis Northern Europe and Scandinavia 

In Europe, we expect economics news flow to be marginally positive next year, and German policies to 

remain supportive of Europe. Although Europe continues to attract capital on the back of accommodative 

monetary policy on the continent, we expect European growth to be sluggish in 2014. From a monetary 

perspective, we expect the European Central Bank to ease monetary policy to support growth. We 

continue to be pessimistic on the economic outlook of Southern Europe vis-à-vis Northern Europe and 

Scandinavia but we have reduced our underweight given its reduction in sovereign risk. Overall, we think 

that the focus will return to growth in Europe. 

UK economy continues to be positive 

UK economic conditions continue to be positive, with economic data indicating the start of a broad-based 

recovery. We expect the Bank of England governor, Mark Carney, to continue with an accommodative 

monetary policy and a positive boost to the housing market supported by the Government ‘Help to Buy’ 

program. The current weakness in the currency continues to make London an even more attractive place 

for capital. While growth in London remains strong, we expect growth outside of London to accelerate. 

Expect further easing in Japan 

Further easing by the Bank of Japan is likely in 2014 and we expect the Bank of Japan to continue 

purchasing assets, boosting market sentiment. We also expect the Japanese economy to strengthen on 

4

the back of structural reforms and changes in tax policy. From a fundamental perspective, we feel that: 

(i) Grade A office vacancy should continue to improve through the year, (ii) small business sentiment 

continues to improve and it should drive demand and for Grade B office, and (iii) High Quality Industrial 

space should continue to see stable demand. Also, we expect additional infrastructure spending over the 

next few years for the 2020 Summer Olympics. Furthermore, we expect multiple primary and secondary 

offerings in the JREIT space. 

Continue to be sanguine on the Asian REITs 

With the onset of the Quantitative Easing, we believe that investors will eventually form a better idea of 

where long-bond yields will settle in the US and Asia. Our view remains that in an environment where 

bond yields are rising due to stronger growth expectations, Asian REITs are likely to see healthier rental 

income, which should more than offset the effect of any increase in interest payments. This is especially 

so in the more cyclical real estate sectors, including office and hotels. We continue to believe that there is 

room for compression in the spread between REITs yields and long-bond yields, as investors gain greater 

visibility on the final impact of tapering on bond yields, and also the benefits of a healthier economic 

environment. We are now marginally underweight on the Asia-Pacific ex-Japan region as we added to 

ideas in other regions. Within the Asia-Pacific ex-Japan region, we remain overweight in Malaysia, Hong 

Kong and Singapore, and underweight in Australia. 

5

IMPORTANT INFORMATION 

This document is for information only with no consideration given to the specific investment 

objective, financial situation and particular needs of any specific person. Any securities mentioned 

herein are for illustration purposes only and should not be construed as a recommendation for 

investment. You should seek advice from a financial adviser before making any investment. In the 

event that you choose not to do so, you should consider whether the investment selected is suitable 

for you. Investments in unit trusts are not deposits in, obligations of, or guaranteed or insured by 

Nikko Asset Management Asia Limited (“Nikko AM Asia”). 

Past performance or any prediction, projection or forecast is not indicative of future 

performance. The funds may use or invest in financial derivative instruments. The value of units 

and income from them may fall or rise. Investments in the funds are subject to investment risks, 

including the possible loss of principal amount invested. You should read the relevant prospectus and 

product highlights sheet obtainable from appointed distributors of Nikko AM Asia or our website 

(www.nikkoam.com.sg) before investing. 

The information contained herein may not be copied, reproduced or redistributed without the 

express consent of Nikko AM Asia. While reasonable care has been taken to ensure the accuracy 

of the information as at the date of publication, Nikko AM Asia does not give any warranty or 

representation, either express or implied, and expressly disclaims liability for any errors or omissions. 

Information may be subject to change without notice. Nikko AM Asia accepts no liability for any 

loss, indirect or consequential damages, arising from any use of or reliance on this document. 

The CPF interest rate for the Ordinary Account (“OA”) is based on the 12-month fixed deposit and 

month-end savings rates of major local banks, subject to a minimum 2.5% interest per annum. The 

interest rate for Special, Medisave and Retirement Accounts (“SMRA”) is pegged to the 12-month 

average yield of 10-year Singapore Government Securities yield plus 1%. A 4% floor rate will be 

maintained for interest earned on SMRA until 31 December 2014, after which a 2.5% minimum 

rate will apply. An extra 1% interest is paid on the first S$60,000 of a member’s combined balances, 

including up to S$20,000 in the OA. The first S$20,000 in the OA and the first S$40,000 in the 

Special Account (“SA”) cannot be invested under the CPF Investment Scheme (“CPFIS”). 

For Hong Kong Investors 

The fund is only offered to professional investors and is not authorized by the Securities and Futures 

Commission in Hong Kong. The contents of this document have not been reviewed by any regulatory 

authority in Hong Kong. You are advised to exercise caution in relation to this document. If you are 

in any doubt about any of the contents, you should obtain independent professional advice. 

Nikko Asset Management Asia Limited. Registration Number 198202562H 

6

SOFT DOLLAR COMMISSIONS/ARRANGEMENTS 

Appointment of soft dollar brokers 

Soft dollar brokers will be appointed onto the Managers’ broker panel only after the Managers have 

ensured that: 

a) full disclosure of the practice of accepting soft dollars is made; 

b) the commission rates charged are comparable with the market rates; 

c) there is no conflict of interest; 

d) the soft dollar credits are used only for clearly defined services; 

e) at all times trades are executed through the respective brokers only on the basis of best execution 

regardless whether soft dollar benefits will accrue. Best execution shall include competitive prices 

with smooth execution ability; and 

f) relevant regulations and guidelines are complied with. 

The procedures for the appointment of the brokers shall be no different from that of normal full service 

brokers. 

Execution and allocation 

If the Trustee objects to the use of the soft dollar brokers, the trades of the Fund shall be segregated 

from the rest of the trades that are executed through the relevant soft dollar broker(s). The Managers 

will execute trades for such accounts only with authorised full service brokers. 

It is the responsibility of the Managers to ensure that the allocation quotas are adhered to. In addition, 

the Managers will monitor the execution ability of the soft dollar brokers and assign the business strictly 

on a “best execution” basis. 

Subject to the provisions of the Code*, in its management of the Fund, the Managers may receive soft 

dollar commissions from, or may enter into soft dollar arrangements with, stockbrokers who execute trades 

on behalf of the Fund and the soft dollars received would be restricted to the following kinds of services: 

a) specific advice as to the advisability of dealing in, or of the value of any investments; 

b) research and advisory services; 

c) economic and political analysis; 

d) portfolio analysis including valuation and portfolio measurements; 

e) market analysis; 

f) data and quotation services; 

g) computer hardware or software that are used to support the investment decision making process, 

the giving of advice, or the conduct of research or analysis; and 

h) custodial services in relation to the investments managed for clients. 

The following are, however, prohibited: 

a) travel, accommodation and entertainment expenses; 

b) general administrative goods and services including office equipment and premises; 

c) membership fees; 

d) employee salaries; 

e) direct money payments / rebates. 

Records of the payments made using soft dollar commissions shall be retained with the Managers. 

Subject to the provisions of the Code*, the Sub-Managers of the Nikko AM Shenton Global Property 

Securities Fund (the “Fund”) may receive soft-dollar commissions from, or may enter into soft dollar 

arrangements with, stockbrokers who execute trades on behalf of the Fund. However, in any such 

arrangement, the Sub-Managers of the Fund will abide by the restrictions and prohibitions set out in 

paragraph above. 

The Managers, the Sub-Managers of the Fund will not accept or enter into soft-dollar commissions / 

arrangements unless: 

• such soft-dollar commissions / arrangements would in the opinion of the Managers / Sub-Managers, 

assist the Managers / Sub-Managers in their management of the Fund; 

• the Managers / Sub-Managers shall ensure at all times that best execution is carried out for the 

transactions; and 

• no unnecessary trades are entered into in order to qualify for such soft-dollar commissions / 

arrangements. 

The Managers, the Sub-Managers of the Fund will comply with applicable regulatory and industry 

standards on soft dollars. 

* The “Code” shall mean the Code on Collective Investment Schemes dated 30 September 2011 issued 

by the Authority, as may be amended from time to time. 

7

NIKKO AM SHENTON GLOBAL PROPERTY SECURITIES FUND 

(Constituted under a Trust Deed registered in the Republic of Singapore) 

STATEMENT OF TOTAL RETURN 

For the financial period from 01 July 2013 to 31 December 2013 (unaudited) 

31 Dec 2013 31 Dec 2012 

S$ S$ 

Income 

Dividends 421,252 806,338 

Interest 4 34 

Other Income 1,065 578 

422,321 806,950 

Less: Expenses 

Management fee 178,702 357,352 

Registrar fee 17,248 8,305 

Trustee fee 5,148 9,489 

Custody fee 19,894 9,191 

Audit fee 6,156 6,301 

Valuation fee 5,882 10,675 

Transaction costs 32,146 65,700 

Other expenses (5,628) 28,052 

259,548 495,065 

Net income 162,773 311,885 

Net gains or losses on value of investments 

and financial derivatives 

Net (losses)/gains on investments (462,998) 1,754,646 

Net foreign exchange losses (18,987) (14,353) 

Net losses on Financial Derivatives (48) - 

(482,033) 1,740,293 

Total (deficit)/return for the financial period 

before income tax (319,260) 2,052,178 

Less: Income tax (85,490) (156,987) 

Total (deficit)/return for the financial period 

after income tax (404,750) 1,895,191 

8



STATEMENT OF FINANCIAL POSITION 

As at 31 December 2013 (unaudited) 

31 Dec 2013 30 June 2013 

S$ S$ 

ASSETS 

Portfolio of investments 23,994,988 25,802,874 

Sales awaiting settlement 744,919 484,964 

Receivables 246,540 333,444 

Cash and bank balances 987,391 882,437 

Total assets 25,973,838 27,503,719 

LIABILITIES 

Payables 381,274 458,538 

Purchases awaiting settlement 871,611 503,501 

Distribution payable 187,086 194,946 

Total liabilities 1,439,971 1,156,985 

EQUITY 

Net assets attributable to unitholders 24,533,867 26,346,734 

9



STATEMENT OF MOVEMENTS OF UNITHOLDERS' FUNDS 


31 Dec 2013 30 June 2013 

S$ S$ 

Net assets attributable to unitholders at the 

beginning of the financial period 26,346,734 48,918,804 

Operations 

Change in net assets attributable to unitholders 

resulting from operations (404,750) 5,573,342 

Unitholders' contributions/(withdrawals) 

Creation of units 1,797,718 3,645,912 

Cancellation of units (2,828,512) (30,495,867) 


resulting from net creation and cancellation of units (1,030,794) (26,849,955) 

Distributions (377,323) (1,295,457) 

Total decrease in net assets attributable to 

unitholders (1,812,867) (22,572,070) 


end of financial period 24,533,867 26,346,734 

10



STATEMENT OF PORTFOLIO 


By Geography (Primary) 

Quoted Equities 

Holdings at 

31 Dec 2013 

Percentage of 

total net assets 

attributable to 

Fair value at unitholders at 

31 Dec 2013 31 Dec 2013 

S$ % 

BERMUDA ISLANDS 

Hongkong Land Holdings Limited 60,940 453,963 1.85 

Total Bermuda Islands 453,963 1.85 

BRITAIN 

Capital & Counties Properties PLC 56,529 389,141 1.59 

Unite Group PLC 27,560 232,022 0.95 

Total Britain 621,163 2.54 

CAYMAN ISLANDS 

Langham Hospitality Investments Limited 458,000 277,435 1.13 

Total Cayman Islands 277,435 1.13 

FINLAND 

Sponda OYJ 24,690 146,908 0.60 

Total Finland 146,908 0.60 

GERMANY 

Deutsche Wohnen AG 15,830 388,466 1.58 

Leg Immobilien AG 1,210 90,416 0.37 

Tag Immobilien AG 8,650 132,133 0.54 

Total Germany 611,015 2.49 

HONG KONG SAR 

Hang Lung Properties Limited 34,000 135,643 0.55 

Wharf Holdings Limited 59,300 572,615 2.33 

Total Hong Kong SAR 708,258 2.88 

JAPAN 

Mitsui Fudosan Company Limited 2,000 90,937 0.37 

Sumitomo Realty & Development Company Limited 1,000 62,827 0.25 

Tokyu Fudosan Holdings Corporation 12,400 147,469 0.60 

Total Japan 301,233 1.22 

MALAYSIA 

Sunway BHD 143,333 149,729 0.61 

YTL Land & Development BHD 289,500 104,340 0.43 

Total Malaysia 254,069 1.04 

SWEDEN 

Wihlborgs Fastigheter AB 8,230 186,465 0.76 

Total Sweden 186,465 0.76 

Total Quoted Equities 3,560,509 14.51 

11





By Geography (Primary)(continued) 

Quoted Real Estate Investment Trusts 

Holdings at 

31 Dec 2013 

Percentage of 

total net 

assets 



31 Dec 2013 31 Dec 2013 

S$ % 

AUSTRALIA 

Federation Centres Limited 106,611 281,799 1.15 

Goodman Group 93,460 499,355 2.04 

Stockland 29,681 121,034 0.49 

Westfield Group 31,873 363,276 1.48 

Westfield Retail Trust 36,161 120,499 0.49 

Total Australia 1,385,963 5.65 

BRITAIN 

Big Yellow Group PLC 10,190 101,854 0.42 

British Land Company PLC 30,751 404,470 1.65 

Land Securities Group PLC 22,841 460,196 1.88 

Londonmetric Property PLC 79,690 230,463 0.94 

Safestore Holdings PLC 54,310 182,844 0.75 

Total Britain 1,379,827 5.64 

CANADA 

Allied Properties Real Estate Investment Trust 1,190 46,327 0.19 

Boardwalk Real Estate Investment Trust 1,100 78,235 0.32 

Dundee Real Estate Investment Trust 2,000 68,496 0.28 

Total Canada 193,058 0.79 

FRANCE 

Icade 1,770 208,386 0.85 

Mercialys SA 6,750 179,091 0.73 

Unibail-Rodamco SE 3,290 1,066,084 4.35 

Total France 1,453,561 5.93 

GERMANY 

Alstria Office Reit-AG 14,870 237,003 0.97 


HONG KONG SAR 

Prosperity Reit 300,000 110,404 0.45 


JAPAN 

GLP J-Reit 205 253,157 1.03 

Industrial & Infrastructure Fund Investment Corporation 26 273,915 1.12 

Japan Logistics Fund Incorporation 10 133,942 0.55 

Japan Real Estate Investment Corporation 32 216,806 0.88 

Kenedix Realty Investment Corporation 23 138,008 0.56 

Mori Trust Sogo Reit Incorporation 12 120,800 0.49 

Nippon Building Fund Incorporation 28 205,850 0.84 

Orix Jreit Incorporation 88 139,223 0.57 

Total Japan 1,481,701 6.04 

12






Percentage of 



Holdings at Fair value at unitholders at 

31 Dec 2013 31 Dec 2013 31 Dec 2013 

S$ % 

SINGAPORE 

Capitamall Trust 190,000 361,950 1.48 

CDL Hospitality Trusts 165,000 270,600 1.10 

Soilbuild Business Space Reit 312,000 240,240 0.98 

Suntec Real Estate Investment Trust 204,000 314,160 1.28 

Total Singapore 1,186,950 4.84 

UNITED STATES OF AMERICA 

Alexandria Real Estate Equities Incorporation 2,640 212,062 0.85 

American Campus Communities Incorporation 3,400 138,272 0.56 

Ashford Hospitality Prime Incorporation 402 9,238 0.04 

Avalonbay Communities Incorporation 2,220 331,311 1.35 

Aviv Reit Incorporation 2,760 82,589 0.34 

Boston Properties Incorporation 3,850 487,657 1.99 

Brandywine Realty Trust 5,560 98,772 0.40 

BRE Properties Incorporation 1,800 124,293 0.51 

Brixmor Property Group Incorporation 2,340 60,065 0.24 

Camden Property Trust 3,800 272,952 1.11 

Cubesmart 3,860 77,686 0.32 

Digital Realty Trust Incorporation 2,410 149,374 0.61 

Duke Realty Corporation 12,930 245,534 1.00 

Empire State Realty Trust Incorporation 6,150 118,804 0.48 

Equity Residential 3,080 201,713 0.82 

Essex Property Trust Incorporation 1,970 356,707 1.45 

Federal Realty Investment Trust 1,750 224,071 0.91 

First Industrial Realty Trust Incorporation 4,070 89,569 0.37 

General Growth Properties Incorporation 13,830 350,108 1.43 

HCP Incorporation 7,230 331,551 1.35 

Health Care Reit Incorporation 4,580 309,780 1.26 

Highwoods Properties Incorporation 8,030 366,716 1.48 

Host Hotels & Resorts Incorporation 20,390 500,472 2.04 

Hudson Pacific Properties Incorporation 2,870 79,250 0.32 

Kilroy Realty Corporation 3,590 227,271 0.93 

Kimco Realty Corporation 17,830 444,615 1.81 

Liberty Property Trust 9,890 422,689 1.72 

Mid-America Apartment Communities Incorporation 2,720 208,529 0.85 

Omega Healthcare Investors Incorporation 1,530 57,567 0.23 

Prologis Incorporation 12,870 600,425 2.45 

Public Storage 1,650 313,431 1.28 

Regency Centers Corporation 6,250 365,365 1.49 

Retail Properties Of America Incorporation 6,310 101,181 0.41 

Simon Property Group Incorporation 9,930 1,907,725 7.78 

SL Green Realty Corporation 3,320 387,074 1.58 

Sovran Self Storage Incorporation 2,350 193,248 0.79 

Strategic Hotels & Resorts Incorporation 12,590 150,219 0.61 

Sunstone Hotel Investors Incorporation 23,190 392,348 1.60 

Tanger Factory Outlet Centers 9,810 396,603 1.62 

The Macerich Company 4,650 345,749 1.41 

UDR Incorporation 11,740 345,819 1.41 

Ventas Incorporation 7,400 535,368 2.18 

Vornado Realty Trust 3,500 392,240 1.60 

Total United States of America 13,006,012 52.98 

Total Quoted Real Estate Investment Trusts 20,434,479 83.29 

13






Holdings at 

31 Dec 2013 

Percentage of 




31 Dec 2013 31 Dec 2013 

S$ % 

Portfolio of investments 23,994,988 97.80 

Other net assets 538,879 2.20 

Net assets attributable to unitholders 24,533,867 100.00 

14





By Geography (Summary) 


Percentage of total 

net assets 


unitholders at 

31 Dec 2013 

% 


net assets 



30 June 2013 

% 

Bermuda Islands 1.85 2.44 

Britain 2.54 2.07 

Canada - 0.75 

Cayman Islands 1.13 1.15 

Finland 0.60 - 

Germany 2.49 1.32 

Hong Kong SAR 2.88 4.63 

Japan 1.22 1.89 

Malaysia 1.04 2.10 

Norway - 0.48 

Singapore - 1.17 

Sweden 0.76 0.92 

Switzerland - 1.21 

Total Quoted equities 14.51 20.13 


Australia 5.65 5.99 

Britain 5.64 3.53 

Canada 0.79 1.61 

France 5.93 3.33 

Germany 0.97 0.74 


Japan 6.04 4.09 

Singapore 4.84 2.59 

United States of America 52.98 52.08 

Total Quoted Real Estate Investment Trusts 83.29 77.80 

Portfolio of investments 97.80 

97.93 

Other net assets 2.20 

2.07 

Net assets attributable to unit holders 100.00 

100.00 

By Industry (Secondary) 

Percentage of total Percentage of total 

Fair Value at 

31 Dec 2013 

net assets 



31 Dec 2013 

net assets 



30 June 2013 

S$ % % 

Diversified Financial Services 338,225 1.37 - 

Holding Companies- Diversified 572,615 2.33 2.80 

Investment Companies 277,435 1.13 1.15 

Lodging - - 1.17 

Real Estate 2,710,459 11.05 15.01 

Real Estate Investment Trusts (REITs) 19,913,410 81.17 77.57 

Storage/Warehousing 182,844 0.75 0.23 

Portfolio of investments 23,994,988 97.80 97.93 

Other net assets 538,879 2.20 2.07 

Net assets attributable to unitholders 24,533,867 100.00 100.00 

15



REPORT TO UNITHOLDERS 


The following contains additional information relating to the Fund. 

1. Distribution of investments 

Please refer to the Statement of Portfolio on pages 11 to 15. 

2. Credit rating of debt securities 

Nil. 

3. Top 10 holdings 

10 Largest holdings at 31 December 2013 Fair value 

S$ 

Percentage of 



unitholders 

% 

Simon Property Group Incorporation 1,907,725 7.78 

Unibail-Rodamco SE 1,066,084 4.35 

Prologis Incorporation 600,425 2.45 

Wharf Holdings Limited 572,615 2.33 

Ventas Incorporation 535,368 2.18 

Host Hotels & Resorts Incorporation 500,472 2.04 

Goodman Group 499,355 2.04 

Boston Properties Incorporation 487,657 1.99 

Land Securities Group PLC 460,196 1.88 

Hongkong Land Holdings Limited 453,963 1.85 

10 Largest holdings at 31 December 2012 Fair value 

S$ 


net assets 


unitholders 

% 



Wharf Holdings Limited 1,358,393 3.06 

Prologis Incorporation 1,231,539 2.78 

Equity Residential 1,203,140 2.71 

Hongkong Land Holdings Limited 1,201,664 2.71 

Ventas Incorporation 1,130,934 2.55 

Westfield Group 1,112,308 2.51 

Public Storage 1,103,213 2.49 

Health Care Reit Incorporation 993,468 2.24 

16





4. Exposure to financial derivatives 

Nil. 

5. Global exposure to financial derivatives 

Nil. 

6. Collateral 

Nil. 

7. Securities lending or repurchase transactions 

Nil. 

8. Investment in unit trusts, mutual funds and collective investment schemes 


Percentage of 




31 Dec 2013 31 Dec 2013 

S$ % 

AUSTRALIA 

Federation Centres Limited 281,799 1.15 


Stockland 121,034 0.49 

Westfield Group 363,276 1.48 

Westfield Retail Trust 120,499 0.49 


BRITAIN 

Big Yellow Group PLC 101,854 0.42 

British Land Company PLC 404,470 1.65 

Land Securities Group PLC 460,196 1.88 

Londonmetric Property PLC 230,463 0.94 

Safestore Holdings PLC 182,844 0.75 

Total Britain 1,379,827 5.64 

CANADA 

Allied Properties Real Estate Investment Trust 46,327 0.19 

Boardwalk Real Estate Investment Trust 78,235 0.32 

Dundee Real Estate Investment Trust 68,496 0.28 


FRANCE 

Icade 208,386 0.85 

Mercialys SA 179,091 0.73 


Total France 1,453,561 5.93 

GERMANY 

Alstria Office Reit-AG 237,003 0.97 


17





Percentage of 



Quoted Real Estate Investment Trusts (continued) Fair value at unitholders at 

31 Dec 2013 31 Dec 2013 

HONG KONG SAR 

Prosperity Reit 

S$ 

110,404 

% 

0.45 


JAPAN 

GLP J-Reit 253,157 1.03 

Industrial & Infrastructure Fund Investment Corporation 273,915 1.12 

Japan Logistics Fund Incorporation 133,942 0.55 

Japan Real Estate Investment Corporation 216,806 0.88 

Kenedix Realty Investment Corporation 138,008 0.56 

Mori Trust Sogo Reit Incorporation 120,800 0.49 

Nippon Building Fund Incorporation 205,850 0.84 

Orix Jreit Incorporation 139,223 0.57 

Total Japan 1,481,701 6.04 

SINGAPORE 

Capitamall Trust 361,950 1.48 

CDL Hospitality Trusts 270,600 1.10 

Soilbuild Business Space Reit 240,240 0.98 

Suntec Real Estate Investment Trust 314,160 1.28 



Alexandria Real Estate Equities Incorporation 212,062 0.85 

American Campus Communities Incorporation 138,272 0.56 

Ashford Hospitality Prime Incorporation 9,238 0.04 

Avalonbay Communities Incorporation 331,311 1.35 

Aviv Reit Incorporation 82,589 0.34 

Boston Properties Incorporation 487,657 1.99 

Brandywine Realty Trust 98,772 0.40 

BRE Properties Incorporation 124,293 0.51 

Brixmor Property Group Incorporation 60,065 0.24 

Camden Property Trust 272,952 1.11 

Cubesmart 77,686 0.32 

Digital Realty Trust Incorporation 149,374 0.61 

Duke Realty Corporation 245,534 1.00 

Empire State Realty Trust Incorporation 118,804 0.48 

Equity Residential 201,713 0.82 

Essex Property Trust Incorporation 356,707 1.45 

Federal Realty Investment Trust 224,071 0.91 

First Industrial Realty Trust Incorporation 89,569 0.37 

General Growth Properties Incorporation 350,108 1.43 

HCP Incorporation 331,551 1.35 

Health Care Reit Incorporation 309,780 1.26 

Highwoods Properties Incorporation 366,716 1.48 

Host Hotels & Resorts Incorporation 500,472 2.04 

Hudson Pacific Properties Incorporation 79,250 0.32 

Kilroy Realty Corporation 227,271 0.93 

Kimco Realty Corporation 444,615 1.81 

Liberty Property Trust 422,689 1.72 

Mid-America Apartment Communities Incorporation 208,529 0.85 

Omega Healthcare Investors Incorporation 57,567 0.23 

Prologis Incorporation 600,425 2.45 

Public Storage 313,431 1.28 

Regency Centers Corporation 365,365 1.49 

Retail Properties Of America Incorporation 101,181 0.41 


SL Green Realty Corporation 387,074 1.58 

Sovran Self Storage Incorporation 193,248 0.79 

Strategic Hotels & Resorts Incorporation 150,219 0.61 

18





Quoted Real Estate Investment Trusts (continued) 

Sunstone Hotel Investors Incorporation 

392,348 1.60 

Tanger Factory Outlet Centers 

396,603 1.62 

The Macerich Company 345,749 1.41 

UDR Incorporation 345,819 1.41 

Ventas Incorporation 535,368 2.18 

Vornado Realty Trust 392,240 1.60 



9. Borrowings 

Nil. 

10. Amount of units created and cancelled for the financial period ended 31 

December 2013 

Units created 1,797,718 

Units cancelled (2,828,512) 

11. Turnover ratio 

S$ 

31 Dec 2013 31 Dec 2012 

Lower of total value of purchases or sales S$ 7,842,479 12,113,565 

Average daily net asset value S$ 25,643,388 47,174,357 

Total turnover ratio Note % 30.58 25.68 

Note: The portfolio turnover ratio is calculated in accordance with the formula stated in the Code on Collective 

Investment Schemes. The calculation of the portfolio turnover ratio was based on the lower of the total value of 

purchases or sales of the underlying investments, divided by the average daily net asset value. In line with 

Statement of Recommended Accounting Practice 7 “Reporting framework for Unit Trusts” (“RAP 7”) issued by the 

Institute of Certified Public Accountants of Singapore in June 2012, total value of purchases or sales for the current 

year do not include brokerage and other transaction costs. 

12. Expense ratio 

Percentage of 




31 Dec 2013 31 Dec 2013 

S$ % 

31 Dec 2013 31 Dec 2012 

Total operating expenses S$ 612,846 868,863 


Total expense ratio Note % 1.87 1.77 

Note: The expense ratio has been computed based on the guidelines laid down by the Investment Management 

Association of Singapore ("IMAS"). The calculation of the expense ratio at financial year end was based on total 

operating expenses divided by the average net asset value for the year. The total operating expenses do not 

include (where applicable) brokerage and other transactions costs, performance fee, interest expense, distribution 

paid out to unitholders, foreign exchange gains/losses, front or back end loads arising from the purchase or sale of 

other funds and tax deducted at source or arising out of income received. The Sub-Fund does not pay any 

performance fee. The average net asset value is based on the daily balances. 

19





13. Related party transactions 

The Manager of the Fund is Nikko Asset Management Asia Limited, a subsidiary of 

Nikko Asset Management International Limited. As of 1 June 2013, The Trusee of 

the Fund has changed to BNP Paribas Trust Services Singapore Limited (the 

"Trustee"). 

Management fee is payable to Nikko Asset Management Asia Limited. Trustee fee 

is payable to BNP Paribas Trust Services Singapore Limited. 

In addition, the bank holding company and related parties of the Trustee have also 

provided custodian, banking, foreign exchange, fund administration and brokerage 

services to the Fund in the normal course of business at terms agreed between the 

parties and within the provisions of the Trust Deed. 

31 Dec 2013 30 June 2013 

S$ S$ 

Bank balances held with related party of the trustee 987,391 882,437 

14. Any other material information that will adversely impact the valuation of the 

fund 

Nil. 

20

8 Cross Street #08-01 PWC Building Singapore 048424 

Intermediaries Hotline: 1800 535 8025 / 65 6535 8025 

Website: www.nikkoam.com.sg 

Company registration number 198202562H

ANNUAL REPORT 

For the financial year ended 30 June 2013 



1

MANAGERS 





DIRECTORS 




Lim Say Boon 

V Arivazhagan 


Ng Soo Nam 





AUDITORS 









Tan Peng Chin LLC 

30 Raffles Place, #11-00, Chevron House 


CUSTODIAN 

BNP Paribas Securities Services, Singapore Branch 




1


Returns (%) 3 Mth 6 Mth 1 Yr 3 Yr 5 Yr 

Since 

Inception 

Benchmark 1 -1.72 6.77 12.07 13.76 9.98 10.65 


Securities Fund (S$) 2 -2.15 5.12 9.41 11.37 1.97 0.94 

Source: © 2013 Morningstar, Inc. & Nikko Asset Management Asia Limited, returns as at 30 June 2013. Returns are calculated on a 

NAV-NAV basis, SGD, and based on the assumption that all dividends and distributions are reinvested, if any. Returns for period in 

excess of 1 year are annualised. 


Since 

Inception 

Benchmark 1 -1.72 6.77 12.07 13.76 9.98 10.65 


Securities Fund (S$) 2 -7.04 -0.13 3.94 9.48 0.93 0.31 


NAV-NAV basis, SGD, and based on the assumption that all dividends and distributions are reinvested, if any, and take into account 

of maximum sales and realisation charges. Returns for period in excess of 1 year are annualised. 


Since 

Inception 

Benchmark 1 -3.87 2.83 11.94 17.46 11.51 14.25 


Securities Fund (US$) 2 -4.30 1.14 9.21 14.97 3.34 4.18 


NAV-NAV basis, USD, and based on the assumption that all dividends and distributions are reinvested, if any. Returns for period in 

excess of 1 year are annualised. 


Since 

Inception 

Benchmark 1 -3.87 2.83 11.94 17.46 11.51 14.25 


Securities Fund (US$) 2 -9.09 -3.92 3.75 13.02 2.29 3.53 


NAV-NAV basis, USD, and based on the assumption that all dividends and distributions are reinvested, if any, and take into account 

of maximum sales and realisation charges. Returns for period in excess of 1 year are annualised. 


Note: 

(1) The Fund’s benchmark is the UBS Global Real Estate Investors Total Return Index. Prior to 1 March 

2010, the benchmark was Yield Component of UBS Global Real Estate Investors Total Return Index. 

Prior to 1 April 2006, the benchmark was the UBS Global Real Estate Investors Total Return Index 



There was an interim dividend of S$0.55 per 100 units held as of 30 June 2013. For the reinvestment 

of dividends, equivalent units will be created on the payment date 15 July 2013 for both the SGD and 

USD classes. 

2


Underperformed due to stock selection in North America 

During the year under review, the Nikko AM Shenton Global Property Securities Fund (the “Fund”) 

delivered a return of 9.41% (SGD terms, on NAV-NAV basis), underperforming the benchmark by 2.66%. 

Our stock selection in the U.S. and Canada detracted from performance as small caps and defensive 

sectors rallied, driven by the search for yield. Cash allocation was also a drag. This was mitigated by our 

stock selection in the UK and Japan, particularly our exposure to specialist firms in the UK and Tokyo 

office names. Our overweight to the Singapore REITs also added value as the sector outperformed. 


U.S. economic environment should remain positive 

Investors continue to be optimistic regarding growth in the U.S., we believe. Even so, the possibility of 

withdrawal of stimulus has been a source of concern. Our view continues to be that policy support from 

the U.S. Fed is not indefinite and that withdrawal is indicative of more normal economic growth which 

is a positive in the long run. As long as jobs data and retail sales show a stable recovery, the economic 

environment should remain positive, in our opinion. The Canadian economy is set to continue expanding 

on the back of the resources industry and stable commodity prices. 

Stable debt markets, but growth to be sluggish 

European sovereign debt markets have been relatively stable on the back of continued easing in the U.S. 

and Japan. Our expectation continues to be that European growth should be sluggish in 2013. We also 

expect the European Central Bank to further ease monetary policy once German elections are complete. 

Southern European countries should continue to bear the painful readjustments in their economy on the 

back of the austerity drive. We continue to be pessimistic on the economic outlook of Southern Europe 

in the long run vis-à-vis Northern Europe and Scandinavia but have reduced our underweight given 

reduction in sovereign risk. 

UK economy sluggish, but London remains attractive 

UK economic conditions continue to be sluggish, which is being reflected in the weakness of the GBP. 

We expect new Bank of England governor, Mark Carney, to have an accommodative monetary policy. 

The current weakness in the currency continues to make London an attractive place for capital. We 

continue to focus on specialty names with London exposure. 

Waiting for structural changes in Japan 

In Japan, fiscal and monetary support measures are in place, and the market is focused on what structural 

changes will be announced by the government over the next few months. It is positive that the government 

has a majority in both houses following the recent upper house elections. The most immediate point of 

interest is whether the government decides to go through with raising the consumption tax from the 

current 5% to 8% in April 2014. The expectation continues to be that monetary base will double over 

the next two years. From a fundamental perspective we feel that Grade A office vacancy should continue 

to improve through the year. High quality industrial space should also see stable demand. We also expect 

multiple primary and secondary offerings in the Japanese REIT space. 

Asian REITs are attractive 

We continue to believe that the economies in the Asia Pacific ex-Japan region will grow at a pace which 

will remain supportive of commercial real estate values and rents. We are sanguine about the Asian REITs 

in the current environment of rising bond yields as they are likely to benefit from stronger rents in an 

environment of recovering global growth. Asian REIT yields remain at attractive levels, having recovered 

only mildly following their recent sell-down. In particular, spreads between REIT yields and long bond 

yields are still elevated, leaving room for compression. We remain overweight in the Asia-Pacific ex-Japan 

region. 

3

Market Review 

Global property stocks gained across all major regions 

Global property stocks gained during the twelve months ended 30 June 2013, with the EPRA/NAREIT 

Global Index rising 10.6% in USD terms. Stocks in the Asia-Pacific and Europe gained the most, while 

those in the Americas lagged. 

US property stocks edged up with improving growth and employment data 

U.S. property stocks gained 5.4% during the period under review in USD terms, according to the FTSE 

EPRA/NAREIT U.S. Index. During the past year, political deadlock meant that in 2013, automatic budget 

cuts were triggered as specified in the Budget Control Act of 2011. The Congressional Budget Office 

(CBO) estimated that sequestration would reduce economic growth in 2013 by 0.6%. The Federal 

Reserve continued to support the economy through Quantitative Easing but in the second quarter of 

2013, it indicated that they expect to taper bond purchases towards the end of the year. This brought 

the chase for yield to an end as the prospect of rising rates became imminent. US unemployment has 

dropped to 7.6% at end of June 2013 from 8.2% at end of June 2012. US has seen positive Gross 

Domestic Product (GDP) growth in all four quarters with 2QGDP coming in at a healthy 1.7% QOQ. In 

company news, firms across the spectrum successfully raised capital. Some notable ones were, Prologis 

(USD 1.2b), AvalonBay (USD 2.1b), Health Care REIT( raised US 1.6b in September 2012 & US1.6b in 

May 2013). 

European property stocks advanced as the Euro crisis abated 

European property stocks advanced during the twelve months to June 2013, with the FTSE EPRA/NAREIT 

Eurozone Index up 13.7% in USD terms. The Eurozone sovereign debt crisis has definitely abated, and 

the European Central Bank’s continued support has driven down yields for all peripheral country bonds 

over the last year. Europe successfully weathered the Cyprus crisis in March 2013 by arranging a Euro 

10 Bn bailout but only after imposing a one-time tax on deposits held in Cypriot banks. In general we 

continue to see a slowdown in consumption. Italian car sales in July were down 5.5% YOY better than 

the 7.98% YOY drop in June. But Eurozone unemployment reached 12.1% at end of June, about 70bps 

higher than last year. Companies continue to opportunistically invest across Europe. The Paris Court of 

Appeal rejected all appeals against Icade’s public offer for Silic clearing all remaining obstacles to create 

the largest listed property company in France. Spanish property company Metrovacesa delisted, bringing 

to an end one of the prominent firms to rise and fall with the Spanish property market. 

UK property stocks staged a strong rally 

UK property stocks gained 16.3% in USD terms during the period under review, as measured by the 

FTSE EPRA/NAREIT UK Index. The UK was one of the best performing regions, helped by GDP having 

expanded in three of the last four quarters. In 2Q2013 GDP grew 0.6% QOQ. Retail Sales ex Autos 

in June was up 2.1%YOY, better than expected. The new governor of the Bank of England, Mark 

Carney announced that going forward, the bank would provide forward guidance on interest rates. 

The Bank reiterated its support for exceptionally accommodative policy till the economic slack has been 

reduced. In company news, Sergio announced a Euro 1 Billion continental logistics joint venture with PSP 

investments. Institutional investors continue to be positive on London and Japanese, US institution and 

Middle East investors were active in the market place. 

Japanese property stocks thrived with a stable environment 

Japanese property stocks surged 39.3% in USD terms over the twelve-month period, according to the 

FTSE EPRA/NAREIT Japan Index. Japanese property firms were the best performing in the FTSE EPRA/ 

NAREIT Global Index. PM Abe decisively won both the general election in December 2012 and the upper 

house election in July 2013. He has focused attention on both fiscal and non-fiscal tools with the aim 

of beating deflation. New Bank of Japan governor, Haruhiko Kuroda also announced plans to double 

the monetary base and adopted a medium term inflation target 2% with the aim of beating deflation. 

4

At the end of June, the Japanese currency weakened to 99 Yen/USD compared to 79 Yen/USD a year 

ago. Given all these positive changes, Japan has seen three consecutive quarters of economic expansion. 

Tokyo office vacancies, which hit 9.43% at end June 2012 (the highest level seen in the last five years) 

has dropped by nearly 100 bps to 8.46% at end of June 2013. Companies have successfully raised 

capital in both primary and secondary offerings. Some notable new firms are Nippon Prologis REIT, GLP 

J-REIT and Nomura Real Estate Master Fund. 

Australian REITs gained as interest rates were cut 

Australian REITs (A-REITs) gained 17.4% in AUD terms during the twelve month period, according to 

the S&P/ASX 200 A-REIT Index. A-REITs underperformed Australian general equities in 2H2012 by 2.1% 

on a total return basis. Over that period, the Reserve Bank of Australia (RBA) cut its cash rate by 50bp 

to 3.00%. While GDP growth remained steady, employment growth remained patchy. In March 2013, 

the Australian economy shed 36,000 jobs, worse than expectations of a 7,500-job loss. The following 

month saw the central bank cut its cash rate by 25bp to 2.75%. However, the 10-year government 

bond yield rose by 26bp in tandem with global comparables. 1Q2013 GDP grew 0.6% QOQ, slightly 

weaker than expectations, while employment grew by 1,000 jobs, better than expectations of 10,000- 

job shrinkage. Recent developments included Mirvac having raised AUD400m in equity to fund the 

AUD584m acquisition of seven office assets from General Electric. Stockland raised AUD400m in equity 

to fund its development pipeline. Federation Centres sold 50% stakes in six retail assets for UAD602m, 

while Charter Hall Retail REIT entered into a conditional contract to sell five assets in Poland for EUR175m. 

Hong Kong property stocks climbed home prices gained 

Hong Kong property stocks climbed 15.6% in HKD terms during the twelve months under review, 

according to the Hang Seng Property Index. In 2H2012, office rents continued to diverge, according to 

the HK Rating and Valuation Department, rising in decentralized locations while staying unchanged in 

Central and Sheung Wan. Retail rents continued to grow, but at a slower pace. At the start of 1H2013, 

home prices reached a new high which led to new measures to cool the property market in February, 

including higher stamp duties and tighter lending rules. In April, new regulations governing sales and 

marketing procedures in detail were implemented. New launches were seen to be temporarily deferred 

as developers adjusted to the new rules. In June, the government announced that developers will be 

allowed to pre-sell residential projects 30 months prior to completion, from 20 months previously. In 

company news, China Overseas Land won the tender for two residential sites at Kai Tak for the total of 

HKD4.54b, at the upper end of expectations. The sites were the first two to be used for building homes 

solely for Hong Kong residents. 

Singapore property stocks rose despite cooling measures 

Singapore property stocks rose in the twelve months under review, with the FTSE ST Real Estate Index up 

14.9% in SGD terms. In 2H2012, office rents in Singapore eased 0.4% while retail rents eased 0.1%, 

according to the Urban Redevelopment Authority. Industrial rents gained 5.1%. Hotel RevPAR was broadly 

stable and private home prices gained 2.5%, with new home sales remaining brisk, despite several 

rounds of cooling measures. In January 2013, the government announced a slew of further tightening 

measures, including higher buyer stamp duties, tighter mortgage rules, additional restrictions on public 

housing and ECs, and the introduction of a seller’s stamp duty for industrial properties. According to the 

Urban Redevelopment Authority, private home prices rose 0.6% QOQ in 1Q2013, slower than the 1.8% 

increase in 4Q12. Office rents eased 0.2%, retails rents declined 0.6% and industrial rents rose 0.4% 

QOQ. The Singapore Tourism Board reported that visitor arrivals to Singapore grew 6.4% YOY to 3.81m 

in 1Q2013, and that Singapore hotel RevPAR fell 4.7% YOY to SGD214.10 in April 2013. In June, the 

Monetary Authority of Singapore introduced new limits on property loans. In recent real estate news, 

Ascendas Hospitality Trust issued 226.4m new stapled securities, raising more than SGD200m. Keppel 

REIT’s largest shareholder Keppel Corp completed a dividend-in-specie of 361.3m units or a 13.5% stake 

in Keppel REIT units to its shareholders, and sold 180m units or a 6.7% stake in Keppel REIT to Goldman 

Sachs. 

5


This document is for information only with no consideration given to the specific investment 

objective, financial situation and particular needs of any specific person. Any securities mentioned 

herein are for illustration purposes only and should not be construed as a recommendation for 

investment. You should seek advice from a financial adviser before making any investment. In the 

event that you choose not to do so, you should consider whether the investment selected is suitable 

for you. Investments in unit trusts are not deposits in, obligations of, or guaranteed or insured by 

Nikko Asset Management Asia Limited (“Nikko AM Asia”). 





product highlights sheet obtainable from appointed distributors of Nikko AM Asia or our website 

(www.nikkoam.com.sg) before investing. 

The information contained herein may not be copied, reproduced or redistributed without the 

express consent of Nikko AM Asia. While reasonable care has been taken to ensure the accuracy 

of the information as at the date of publication, Nikko AM Asia does not give any warranty or 

representation, either express or implied, and expressly disclaims liability for any errors or omissions. 

Information may be subject to change without notice. Nikko AM Asia accepts no liability for any 

loss, indirect or consequential damages, arising from any use of or reliance on this document. 

The CPF interest rate for the Ordinary Account (“OA”) is based on the 12-month fixed deposit and 

month-end savings rates of major local banks, subject to a minimum 2.5% interest per annum. The 

interest rate for Special, Medisave and Retirement Accounts (“SMRA”) is pegged to the 12-month 

average yield of 10-year Singapore Government Securities yield plus 1%. A 4% floor rate will be 

maintained for interest earned on SMRA until 31 December 2013, after which a 2.5% minimum 

rate will apply. An extra 1% interest is paid on the first S$60,000 of a member’s combined balances, 

including up to S$20,000 in the OA. The first S$20,000 in the OA and the first S$40,000 in the 

Special Account (“SA”) cannot be invested under the CPF Investment Scheme (“CPFIS”). 


The Fund is offered only to professional investors and is not authorized by the Securities and 

Futures Commission in Hong Kong. The contents of this document have not been reviewed by any 

regulatory authority in Hong Kong. You are advised to exercise caution in relation to this document. 

If you are in any doubt about any of the contents of this document, you should obtain independent 

professional advice. 


6


Appointment of soft dollar brokers 

Soft dollar brokers will be appointed onto the Managers’ broker panel only after the Managers have 

ensured that: 

a) full disclosure of the practice of accepting soft dollars is made; 

b) the commission rates charged are comparable with the market rates; 

c) there is no conflict of interest; 

d) the soft dollar credits are used only for clearly defined services; 

e) at all times trades are executed through the respective brokers only on the basis of best execution 

regardless whether soft dollar benefits will accrue. Best execution shall include competitive prices 

with smooth execution ability; and 

f) relevant regulations and guidelines are complied with. 

The procedures for the appointment of the brokers shall be no different from that of normal full service 

brokers. 

Execution and allocation 

If any Trustee objects to the use of the soft dollar brokers, the trades of the Fund shall be segregated 

from the rest of the trades that are executed through the relevant soft dollar broker(s). The Managers 

will execute trades for such accounts only with authorised full service brokers. 

It is the responsibility of the Managers to ensure that the allocation quotas are adhered to. In addition, 

the Managers will monitor the execution ability of the soft dollar brokers and assign the business strictly 

on a “best execution” basis. 

Subject to the provisions of the Code, in its management of the Fund, the Managers may receive soft 

dollar commissions from, or may enter into soft dollar arrangements with, stockbrokers who execute 

trades on behalf of the Fund and the soft dollars received would be restricted to the following kinds of 

services: 

a) specific advice as to the advisability of dealing in, or of the value of any investments; 

b) research and advisory services; 

c) economic and political analysis; 

d) portfolio analysis including valuation and portfolio measurements; 

e) market analysis; 

f) data and quotation services; 

g) computer hardware or software that are used to support the investment decision making process, 

the giving of advice, or the conduct of research or analysis; and 

h) custodial services in relation to the investments managed for clients. 

The following are, however, prohibited: 

a) travel, accommodation and entertainment expenses; 

b) general administrative goods and services including office equipment and premises; 

c) membership fees; 

d) employee salaries; 

e) direct money payments / rebates. 

Records of the payments made using soft dollar commissions shall be retained with the Managers. 

Subject to the provisions of the Code, the Sub-Managers of the Nikko AM Shenton Global Property 

Securities Fund (the “Fund”) may receive soft-dollar commissions from, or may enter into soft dollar 

arrangements with, stockbrokers who execute trades on behalf of the Fund. However, in any such 

arrangement, the Sub-Managers of the Fund will abide by the restrictions and prohibitions set out in 

paragraph above. 

The Managers, the Sub-Managers of the Fund will not accept or enter into soft-dollar commissions / 

arrangements unless: 

• such soft-dollar commissions / arrangements would in the opinion of the Managers / Sub-Managers, 

assist the Managers / Sub-Managers in their management of the relevant Scheme; 



• no unnecessary trades are entered into in order to qualify for such soft-dollar commissions / 

arrangements. 

The Managers, the Sub-Managers of the Fund will comply with applicable regulatory and industry 

standards on soft dollars. 

7



REPORT OF THE TRUSTEE 


The Trustee is under a duty to take into custody and hold the assets of Nikko AM Shenton 

Global Property Securities Fund (the “Fund”) in trust for the unitholders. In accordance with 

the Securities and Futures Act (Cap. 289), its subsidiary legislation and the Code on 

Collective Investment Schemes, the Trustee shall monitor the activities of the Manager for 

compliance with the limitations imposed on the investment and borrowing powers as set 

out in the Trust Deed in each annual accounting year and report thereon to unitholders in 

an annual report. 

To the best knowledge of the Trustee, the Manager has, in all material respects, managed 

the Fund during the financial year covered by these financial statements, set out on pages 

11 to 36, in accordance with the limitations imposed on the investment and borrowing 

powers set out in the Trust Deed. 

For and on behalf of the Trustee 


Authorised signatory 

8



STATEMENT BY THE MANAGER 


In the opinion of the directors of Nikko Asset Management Asia Limited, the accompanying 

financial statements set out on pages 11 to 36, 

comprising the Statement of Total Return, 

Statement of Financial Position, Statement of Movements of Unitholders’ Funds, 

Statement of Portfolio and Notes to the Financial Statements are drawn up so as to 

present fairly, in all material respects, the financial position of Nikko AM Shenton Global 

Property Securities Fund (the “Fund”) as at 30 June 2013, and the total return and changes 

in unitholders’ funds for the year then ended in accordance with the recommendations of 

Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” 

issued by the Institute of Singapore Chartered Accountants (formerly known as Institute of 

Certified Public Accountants of Singapore). At the date of this statement, there are 

reasonable grounds to believe that the Fund will be able to meet its financial obligations as 

and when they materialise. 

For and on behalf of the Manager 


Authorised signatory 

9

INDEPENDENT AUDITOR’S REPORT TO THE UNITHOLDERS OF 



We have audited the financial statements of Nikko AM Shenton Global Property Securities Fund 

(the “Fund”), which comprise the Statement of Financial Position and Statement of Portfolio as at 30 

June 2013, the Statement of Total Return and Statement of Movements of Unitholders’ Funds for 

the year then ended, and a summary of significant accounting policies and other explanatory 

information, as set out on pages 11 to 36. 

Manager's Responsibility for the Financial Statements 

The Fund’s Manager (the “Manager”) is responsible for the preparation and fair presentation of 

these financial statements in accordance with the recommendations of Statement of Recommended 

Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore 

Chartered Accountants (formerly known as Institute of Certified Public Accountants of Singapore), 

and for such internal control as the Manager determines is necessary to enable the preparation of 

financial statements that are free from material misstatement, whether due to fraud or error. 

Auditor’s Responsibility 

Our responsibility is to express an opinion on these financial statements based on our audit. We 

conducted our audit in accordance with Singapore Standards on Auditing. Those standards require 

that we comply with ethical requirements and plan and perform the audit to obtain reasonable 

assurance about whether the financial statements are free from material misstatement. 

An audit involves performing procedures to obtain audit evidence about the amounts and 

disclosures in the financial statements. The procedures selected depend on the auditor’s 

judgement, including the assessment of the risks of material misstatement of the financial 

statements, whether due to fraud or error. In making those risk assessments, the auditor considers 

internal control relevant to the Fund’s preparation and fair presentation of financial statements in 

order to design audit procedures that are appropriate in the circumstances, but not for the purpose 

of expressing an opinion on the effectiveness of the Fund’s internal control. An audit also includes 

evaluating the appropriateness of accounting policies used and the reasonableness of accounting 

estimates made by the Manager, as well as evaluating the overall presentation of the financial 

statements. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis 

for our audit opinion. 

Opinion 

In our opinion, the financial statements present fairly, in all material respects, the financial position 

of the Fund as at 30 June 2013 and the total return for the year then ended in accordance with the 

recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for 

Unit Trusts” issued by the Institute of Singapore Chartered Accountants. 


Public Accountants and Chartered Accountants 

Singapore 

10





Note 2013 2012 

S$ S$ 

Income 

Dividends 1,481,377 2,048,474 

Other income 710 1,424 

1,482,087 2,049,898 


Management fee 657,362 803,367 

Registrar fee 19,876 30,506 

Trustee fee 17,469 21,408 

Custody fee 57,685 11,781 

Audit fee 12,800 12,000 

Valuation fee 19,653 24,084 

Transaction costs 125,090 181,724 

Other expenses 30,615 30,705 

940,550 1,115,575 

Net income 541,537 934,323 

Net gains or losses on value of investments 

and financial derivatives 

Net gains on investments 5,338,146 394,639 


Net losses on futures (15) - 

5,296,907 332,572 

Total return for the year financial year before 

income tax 5,838,444 1,266,895 

Less: Income tax 3 (265,102) (324,883) 

Total return for the financial year after income 

tax 5,573,342 942,012 

The accompanying notes form an integral part of the financial statements 

11




As at 30 June 2013 

Note 2013 2012 

S$ S$ 

ASSETS 



Receivables 4 333,444 465,633 

Cash and bank balances 5 882,437 1,009,649 

Total assets 27,503,719 49,848,754 

LIABILITIES 

Payables 6 458,538 485,916 



Total liabilities 1,156,985 929,950 

EQUITY 

Net assets attributable to unitholders 7 26,346,734 48,918,804 


12



STATEMENT OF MOVEMENTS OF UNITHOLDERS' FUNDS 


Note 2013 2012 

S$ S$ 


beginning of the financial year: 

As previously stated 49,338,126 64,990,336 

Effect of adoption of revised RAP 7 7 (419,322) (463,261) 

Restated 48,918,804 64,527,075 

Operations 


resulting from operations 5,573,342 942,012 





resulting from net creation and cancellation of 

units (26,849,955) (14,820,868) 

Distributions 8 (1,295,457) (1,729,415) 

Total decrease in net assets attributable 

to unitholders (22,572,070) (15,608,271) 


end of the financial year 7 26,346,734 48,918,804 


13







Percentage of 


Holdings at Fair value at 



30 June 2013 30 June 2013 30 June 2013 

S$ % 


Hongkong Land Holdings Ltd 73,940 642,380 2.44 

Total Bermuda Islands 642,380 2.44 

BRITAIN 

Capital & Counties Properties PLC 56,447 353,449 1.34 

Unite Group PLC 27,560 191,232 0.73 


CANADA 

Brookfield Office Properties Inc 9,380 196,780 0.75 


CAYMAN ISLANDS 

Langham Hospitality Investments Ltd 458,000 301,811 1.15 

Total Cayman Islands 301,811 1.15 

GERMANY 

Deutsche Wohnen AG 5,530 118,746 0.45 

LEG Immobilien AG 1,670 109,893 0.42 

TAG Immobilien AG 8,650 119,060 0.45 


HONG KONG SAR 

Hang Lung Properties Ltd 109,000 482,123 1.83 

Wharf Holdings Ltd 69,300 738,264 2.80 

Total Hong Kong SAR 1,220,387 4.63 

JAPAN 

Mitsui Fudosan Co Ltd 8,000 297,850 1.13 

Sumitomo Realty & Development Co Ltd 4,000 201,733 0.76 


MALAYSIA 

Sunway Bhd 190,000 268,471 1.02 

YTL Land & Development Berhad 669,500 284,877 1.08 

Total Malaysia 553,348 2.10 

NORWAY 

Norwegian Property ASA 79,650 126,398 0.48 

Total Norway 126,398 0.48 

SINGAPORE 

Overseas Union Enterprise Ltd 109,000 309,560 1.17 

Total Singapore 309,560 1.17 

SWEDEN 




14





By Geography (Primary) (continued) 

Percentage of 





30 June 2013 30 June 2013 30 June 2013 

S$ % 

SWITZERLAND 

Mobimo Holding AG 140 35,918 0.13 

PSP Swiss Property AG 2,600 284,038 1.08 

Total Switzerland 319,956 1.21 

Total Quoted Equities 5,304,338 20.13 


AUSTRALIA 

Federation Centres Ltd 106,611 284,670 1.08 

Goodman Group 93,460 521,894 1.98 

Stockland 29,681 119,569 0.45 

Westfield Group 39,773 524,078 1.99 



BRITAIN 

British Land Co PLC 30,129 328,336 1.25 

Land Securities Group PLC 22,460 381,941 1.45 

Londonmetric Property PLC 79,690 158,971 0.60 

Safestore Holdings PLC 25,570 61,117 0.23 


CANADA 

Allied Properties Real Estate Investment Trust 1,190 45,652 0.17 

Boardwalk Real Estate Investment Trust 1,100 77,058 0.29 

Calloway Real Estate Investment Trust 4,860 150,218 0.57 

Canadian Apartment Properties 920 24,731 0.09 

Chartwell Retirement Residences 4,260 49,934 0.19 

Dundee Real Estate Investment Trust 2,000 78,264 0.30 


FRANCE 

ICADE 540 56,344 0.21 

Unibail-Rodamco SE 2,785 821,163 3.12 

Total France 877,507 3.33 

GERMANY 

Alstria Office REIT-AG 14,140 194,416 0.74 


HONG KONG SAR 

Champion Real Estate Investment Trust 526,000 302,756 1.15 

Hui Xian Real Estate Investment Trust 360,000 291,763 1.11 

Regal Real Estate Investment Trust 1,083,000 416,160 1.58 

Total Hong Kong SAR 1,010,679 3.84 


15






Percentage of 





30 June 2013 30 June 2013 30 June 2013 

S$ % 

JAPAN 

GLP J-Reit 130 160,007 0.61 

Industrial & Infrastructure Fund Investment Corporation 12 146,933 0.56 

Japan Real Estate Investment Corporation 6 84,804 0.32 

Japan Retail Fund Investment Corporation 77 201,541 0.76 

Nippon Building Fund Inc 14 203,955 0.77 

Nippon Prologis Reit Inc 21 229,248 0.87 

Nomura Real Estate Master Fund Inc 42 52,606 0.20 

Total Japan 1,079,094 4.09 

SINGAPORE 

CDL Hospitality Trusts 223,000 376,870 1.43 

Mapletree Industrial Trust 233,000 306,395 1.16 



Alexandria Real Estate Equities Inc 860 71,694 0.27 

Ashford Hospitality Trust Inc 5,320 77,257 0.29 

Avalonbay Communities Inc 3,470 594,003 2.25 

Aviv REIT Inc 2,430 77,912 0.30 

Boston Properties Inc 2,790 373,070 1.42 

BRE Properties Inc 3,370 213,751 0.81 


Campus Crest Communities Inc 2,570 37,648 0.14 

CubeSmart 9,400 190,514 0.72 

CyrusOne Inc 3,340 87,730 0.33 

DDR Corporation 22,570 476,329 1.81 

Digital Realty Trust Inc 2,450 189,547 0.72 


Equity Residential 2,950 217,343 0.82 

Essex Property Trust Inc 1,910 385,000 1.46 

Excel Trust Inc 4,460 72,461 0.28 

First Industrial Realty Trust Inc 6,050 116,479 0.44 

General Growth Properties Inc 11,640 293,636 1.12 

HCP Inc 6,690 385,640 1.46 

Health Care REIT Inc 4,040 343,508 1.30 

Highwoods Properties Inc 5,550 250,731 0.95 

Host Hotels & Resorts Inc 15,890 339,784 1.29 

Hudson Pacific Properties Inc 1,520 40,985 0.16 

Kilroy Realty Corporation 3,370 226,531 0.86 


LaSalle Hotel Properties 7,040 220,542 0.84 



Mid-America Apartment Communities Inc 1,820 156,457 0.59 

National Retail Properties Inc 3,330 145,329 0.55 

Prologis Inc 18,700 894,613 3.40 

Public Storage 1,770 344,254 1.31 


16






Percentage of 





30 June 2013 30 June 2013 30 June 2013 

S$ % 

Regency Centers Corporation 3,810 245,622 0.93 

RLJ Lodging Trust 4,620 131,664 0.50 

Simon Property Group Inc 9,190 1,841,480 6.99 


Sovran Self Storage Inc 2,780 228,477 0.87 

Spirit Realty Capital Inc 8,530 191,381 0.73 

Sunstone Hotel Investors Inc 12,410 189,977 0.72 

Tanger Factory Outlet Centers Inc 10,870 461,432 1.75 

UDR Inc 6,910 223,306 0.85 

Ventas Inc 7,140 628,463 2.39 





Other net assets 543,860 2.07 



17





By Geography (Summary) 

Percentage of 




30 June 2013 

% 

Percentage of 




30 June 2012 

% 



Britain 2.07 2.70 

Canada 0.75 0.59 

Cayman Islands 1.15 - 

Germany 1.32 - 


Japan 1.89 0.40 

Malaysia 2.10 - 

Norway 0.48 0.78 


Sweden 0.92 1.37 

Switzerland 1.21 1.21 

Thailand - 0.83 

Total Quoted Equities 20.13 15.89 



Britain 3.53 3.30 

Canada 1.61 2.20 

France 3.33 3.14 

Germany 0.74 1.09 


Japan 4.09 3.56 

Netherlands - 1.16 



Total Quoted Real Estate Investment Trusts 77.80 82.87 

Portfolio of investments 97.93 98.76 

Other net assets 2.07 1.24 

Net assets attributable to unitholders 100.00 100.00 


18





By Industry (Secondary) 

Fair Value at 

30 June 2013 

Percentage of 




30 June 2013 


net assets 



30 June 2012 

S$ % % 

Diversified Holding Companies 738,264 2.80 2.85 

Investment Companies 301,811 1.15 - 

Lodging 309,560 1.17 0.55 

Real Estate Companies 3,954,703 15.01 12.49 

Real Estate Investment Trusts (REITs) 20,437,419 77.57 82.87 

Storage/Warehousing 61,117 0.23 - 


Other net assets 543,860 2.07 1.24 



19



NOTES TO THE FINANCIAL STATEMENTS 


These notes form an integral part of and should be read in conjunction with the 

accompanying financial statements. 

1. General 

Nikko AM Shenton Global Property Securities Fund (the "Fund") is a Singapore 

domiciled fund, constituted as a sub fund of the Nikko AM Asia Investment Funds, 

pursuant to the Trust Deed dated 8 March 2000 as amended by Supplemental 

Deeds and Amended and Restated Deeds (collectively referred to as the “Deeds”). 

The Deeds are governed by the laws of the Republic of Singapore. As of 1 June 

2013, the Trustee of the Fund has changed to BNP Paribas Trust Services 

Singapore Limited (the "Trustee"). The Manager of the Fund is Nikko Asset 

Management Asia Limited. 

As of 30 June 2013, Nikko AM Asia Investment Funds comprise seven separate 

and distinct sub-funds, namely Nikko AM Shenton Asia Dividend Equity Fund 

(formerly known as Nikko AM Shenton Asia Knowledge Fund), Nikko AM Shenton 

Global Property Securities Fund, Nikko AM Shenton Asia Bond Fund, POSB 

InvestSteady Fund, MyHome Fund – Home Steady, MyHome Fund – Home 

Balanced and My Home Fund – Home Growth. 

Only the financial statements of Nikko AM Shenton Property Securities Fund is 

presented in this report. 

The sole shareholder of the Manager, DBS Bank Ltd, had on 30 September 2011 

completed a sale and purchase agreement with Nikko Asset Management 

International Limited and Nikko Asset Management Co., Ltd; pursuant to which 

DBS Bank Ltd had sold and Nikko Asset Management International Limited had 

acquired all the ordinary shares in DBS Asset Management Ltd (the “Share 

Acquisition”). Pursuant to the Share Acquisition, DBS Asset Management Ltd has 

been renamed as Nikko Asset Management Asia Limited (the” Manager”) and the 

Fund renamed as Nikko AM Shenton Global Property Securities with effect from 17 

October 2011. 

2. Significant accounting policies 

The principal accounting policies applied in the preparation of these financial 

statements are set out below: 

(a) 

Basis of preparation 

The financial statements have been prepared under the historical-cost convention, 

as modified by the revaluation of financial assets held at fair value through profit or 

loss. 

20





2. Significant accounting policies (continued) 

(a) 

Basis of preparation (continued) 

The Fund has adopted the recommendations of Recommended Accounting 

Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of 

Singapore Chartered Accountants (formerly known as Institute of Certified Public 

Accountants of Singapore) in June 2012 ("RAP 7") for the financial year beginning 

1 July 2012. 

The adoption of the RAP 7 did not result in substantial changes to the Fund's 

accounting policies and had no material effect on the amounts reported for the 

current or prior financial years except as disclosed below. 

Classification of net assets attributable to unitholders 

RAP7 recommends that a unit trust should classify its units on initial recognition as 

equity and present a Statement of Movements in Unitholders' Funds summarising 

the movements in the value of the trust/fund. Previously, the Fund had classified its 

units as liabilities and presented the movements in value in the notes to the 

financial statements in accordance with the existing framework issued in May 2005. 

On the adoption of RAP7, the Fund has reclassified its units from liabilities to 

equity. Consequently, the Fund's distributions will no longer be classified as a 

finance cost in the Statement of Total Return, but will be recorded as a distribution 

in the Statement of Movements in Unitholders' Funds. 

The reclassification has been applied retrospectively. 

Distributions 

RAP7 recommends that distributions should be accrued for at the point in time 

when the necessary approvals have been obtained and a legal or constructive 

obligation has been created. Previously, the Fund had recognised distributions on 

an ex-date basis. 

The change in accounting policy has been applied retrospectively. 

Financial instruments: fair value measurement 

RAP7 recommends disclosures and presentation of financial instruments in 

accordance with Singapore Financial Reporting Standard 107 "Financial 

Instruments: Disclosures" ("FRS107") wherever possible. 

Apart from enhanced disclosures to present fair value measurements by level of a 

fair value measurement hierarchy, the Fund has previously presented disclosures 

of its financial instruments in accordance with FRS 107 voluntarily. The adoption of 

this recommendation results in additional disclosures but does not have an impact 

on the accounting policies and measurement bases of the Fund. 

21






(a) 

Basis of preparation (continued) 

Transaction costs 

RAP7 recommends that transaction costs, including all expenses relating to the 

purchase and sale of financial instruments, should be charged against income. 

Previously, the Fund had capitalised such expenses and recognised realised 

gains/losses on a net basis. 

Reconciliation of net assets attributable to unitholders per unit for 

issuing/redeeming units and per financial statements 

The application of different valuation and accounting policies may result in 

differences between pricing net asset values and accounting net asset values. 

Where the difference is considered material, RAP7 further recommends that a 

reconciliation of the net assets attributable to unitholders per unit for 

issuing/redeeming units at the financial year end date and the net assets 

attributable to unitholders per unit per the financial statements should be presented 

in the notes to the financial statements. The adoption of this recommendation 

results in additional disclosures but does not have an impact on the accounting 

policies and measurement bases of the Fund. 

(b) 

Recognition of income 

Dividend income from investments is recognised when the right to receive payment 

is established. 

Interest income is recognised on a time-proportion basis using the effective interest 

rate method. 

(c) 

Cash and cash equivalents 

Cash and cash equivalents comprise cash and bank balances and term deposits. 

(d) 

Units 

All units issued by the Trust provide the investors with the right to redemption for 

cash at the value proportionate to the investors' share in the Trust's net assets at 

redemption date. Such instruments give rise to a financial liability for the present 

value of the redemption amount. 

22






(e) 

Investments 

Investments are classified as financial assets at fair value through profit or loss. 

(i) 

Initial recognition 

Purchases of investments are recognised on the trade date. Investments 

are recorded at fair value on initial recognition. 

(ii) 

Subsequent measurement 

Investments are subsequently carried at fair value. Net change in fair value 

on investments are included in the Statement of Total Return in the year in 

which they arise. 

(iii) 

Derecognition 

Investments are derecognised on the trade date of disposal. The resultant 

realised gains and losses on the sales of investments are computed on the 

basis of the difference between the weighted average cost and selling price 

gross of transaction costs, and are taken up in the Statement of Total 

Return. 

(g) 

Basis of valuation of investments 

The fair value of investments traded in active markets is based on quoted market 

prices at the date of the Statement of Financial Position. The quoted market price 

for these investments held by the Fund is the current market quoted bid price. 

(h) 

Receivables 

Receivables are non-derivative financial assets with fixed or determinable 

payments that are not quoted in an active market. Receivables are initially 

recognised at their fair value and subsequently carried at amortised cost using the 

effective interest method, less accumulated impairment losses. 

23






(i) 

Foreign currency translation 

(i) 

Functional and presentation currency 

The Fund qualifies as an authorised scheme under the Securities and 

Futures Act (“SFA”) of Singapore and is offered to retail investors in 

Singapore. The Fund’s activities are substantially based in Singapore, with 

subscription and redemptions of the units of the Fund being denominated in 

Singapore dollars. 

The performance of the Fund is measured and reported to the investors in 

Singapore dollars. The Manager consider the Singapore Dollar as the 

currency which most faithfully represents the economic effects of the 

underlying transactions, events and conditions. The financial statements 

are expressed in Singapore dollars, which is the Fund’s functional and 

presentation currency. 

(ii) 

Transactions and balances 

Foreign currency monetary assets and liabilities are translated into 

Singapore dollars at the rates of exchange prevailing at the date of the 

Statement of Financial Position. The net unrealised gain or loss is taken to 

the Statement of Total Return. Transactions during the year are recorded in 

Singapore dollars at the rates of exchange ruling on transaction dates. All 

realised gains or losses are recognised in the Statement of Total Return. 

(j) 

Financial derivatives 

Financial derivatives are entered into for the purposes of efficient portfolio 

management, tactical asset allocation or specific hedging of financial assets held 

as determined by the Manager and in accordance with the provisions of the Deeds. 

Financial derivatives outstanding at the end of the financial year are valued at 

forward rates or at current market prices using the “mark-to-market” method, as 

applicable, and the resultant gains and losses are taken up in the Statement of 

Total Return. 

24





3. Income tax 

The Fund was granted the status of a Designated Unit Trust by the Inland Revenue 

Authority of Singapore. 

In accordance to Section 35(12) and (12A) of the Income Tax Act (Cap 134) of 

Singapore, subject to certain conditions, the following income shall not form part of 

the statutory income of the Fund and is thus not taxable for the year of assessment: 

(a) 

(b) 

(c) 

(d) 

(e) 

gains or profits derived from Singapore or elsewhere from the disposal of 

securities 

interest (other than interest for which tax has been deducted under section 

45 of the Income Tax Act) 

dividends derived from outside Singapore and received in Singapore 

gains or profits derived from foreign exchange transactions, transactions in 

futures contracts, transactions in interest rate or currency forwards, swaps 

or option contracts and transactions in forwards, swaps or option contracts 

relating to any securities or financial index; and 

distributions from foreign unit trusts derived from outside Singapore and 

received in Singapore. 

2013 

S$ 

2012 

S$ 

Singapore income tax 16,076 14,097 

Overseas income tax 249,026 310,786 

265,102 324,883 

The Singapore tax represents mainly tax charged on gains and interest income 

from non-designated investments. The overseas income tax represents tax 

deducted at source on dividend derived from outside Singapore. 

4. Receivables 

2013 

S$ 

2012 

S$ 

Receivable from unitholders for creation of units 989 305,968 

Dividends receivable 72,230 134,953 

Receivable on currencies purchased 260,225 24,712 

333,444 465,633 

25





5. Cash and bank balances 

The cash and bank balances are placed with a financial institution related to the 

Trustee. 

6. Payables 

2013 

S$ 

2012 

S$ 

Payable to unitholders for cancellation of units 17,546 188,199 

Amount due to the Manager 138,977 198,108 

Registration fees payable 4,776 2,400 

Provision for audit fee 13,853 13,040 

Payable on currencies sold 260,300 24,960 

Amount due to the Trustee 8,560 22,919 

Other payables 14,526 36,290 

458,538 485,916 

Management fee is payable to Nikko Asset Management Asia Limited. Trustee fee 

is payable to BNP Paribas Trust Services Singapore Limited. 

7. Units in issue 

During the year ended 30 June 2013 and 30 June 2012, the number of units 

issued, redeemed and outstanding were as follows: 

2013 2012 

Units at beginning of the financial year 69,886,986 92,652,243 

Units created 4,897,520 4,698,152 

Units cancelled (39,339,713) (27,463,409) 

Units at end of the financial year 35,444,793 69,886,986 

2013 

S$ 

Net assets attributable to unitholdiers – S$ 26,346,734 

Net assets value per unit – S$ 0.743 

26





7. Units in issue (continued) 

2012 

S$ 

As previously stated 49,338,126 

Effect of adoption of revised RAP 7 (419,322) 

Net asset attributable to unitholders 48,918,804 

As previously stated 0.706 

Effect of adoption of revised RAP 7 per unit (0.006) 

Net asset attributable to unitholders per unit 0.700 

As described in Note 2 and consistent with the requirement of the revised RAP 7, in 

preparing the Statement of Movement of Unitholders’ at 30 June 2013 and 2012, 

the Fund’s distribution should be accrued for at the point in time when the 

necessary approval have been obtained and legal and constructive obligation has 

been created. The difference in recognising distribution as prescribed in Note 2 and 

the methodology indicated in the Fund’s regulations, results in a change in the net 

asset value of S$194,946 (2012: S$419,322) for the purpose of calculating the net 

asset value per unit for processing subscriptions and redemptions in the Fund. 

The effect of bid market prices in the net assets attributable to unitholders is as 

follow: 

2013 2012 

Net assets attributable to unitholders per financial 

statements per unit – S$ 0.743 0.700 

Effect of distribution per unit – S$ 0.005 0.006 

Effect of adopting bid prices at fair value per unit – S$ 0.002 0.002 

Net assets attributable to unitholders for issuing/ 

redeeming per unit – S$ 0.750 0.708 

27





8. Distribution 

2013 

S$ 

2012 

S$ 

Final distribution of S$0.55 per 100 units in respect 

of the financial year ended 30 June 2012 194,946 - 

Final distribution of S$0.60 per 100 units in respect 

of the financial year ended 30 June 2011 - 419,322 

Interim distribution of S$0.55 per 100 units in respect 

of financial year ended 30 June 2013 327,559 - 


of the financial year ended 30 June 2013 340,415 - 


of financial year ended 30 June 2013 432,537 - 







1,295,457 1,729,415 

9. Financial risk management 

The Fund’s activities expose it to a variety of risk, including but not limited to market 

risk (including currency risk, interest rate risk and price risk), liquidity risk and credit 

risk. The Manager is responsible for the implementation of the overall risk 

management programme, which seeks to minimise potential adverse effects on the 

Fund’s financial performance. Specific guidelines on exposures to individual 

securities and certain industries and/or countries are in place as part of the overall 

financial risk management to reduce the Fund’s exposures to these risks. 

The Fund’s primary objective is to provide investors with medium to long term 

capital appreciation and to make regular income distributions during the investment 

period by investing in global listed real estate investment trusts ("REITs") (including 

business trusts) and the quoted securities of real estate companies or of those 

traded on a regulated exchange. 

The financial instruments are held in accordance with the published investment 

policies of the Fund and managed accordingly to achieve the investment 

objectives. 

28





9. Financial risk management (continued) 

(a) 

Market risk - Price risk 

Price risk is the risk that arises from uncertainties about the future prices of financial 

instruments. 

The Fund’s investment is substantially dependent on the changes in 

market prices. The Fund’s overall market positions are monitored regularly so as to 

assess changes in fundamentals and valuation. However, events beyond 

reasonable control of the Manager could affect the prices of the underlying 

investments and hence the net asset value of the Fund. 

The Fund's market price risk is managed through diversification of the investment 

portfolio across various geographies globally. 

As the Fund invests primarily in global property securities, the Manager is of the 

view that the price risk the Fund is subject to is best reflected by movements in its 

benchmark of UBS Warburg Global Real Estate Investors Index (the "Index"). 

As at 30 June 2013, an increase/decrease of the Index by 20% (2012: 20%), with 

all other variables remaining constant, the net assets attributable to unitholders for 

the year would increase/decrease by approximately 19% (2012: 19%). Changes in 

market index percentage are revised annually depending on management’s current 

view on market volatility and other relevant factors. 

(b) 

Market risk - Interest rate risk 

Interest rate risk is the risk that the value of a financial instrument will fluctuate due 

to changes in market interest rates (fair value risk). 

Investment funds that invest in equity securities may be subject to interest rate risk 

as any interest rate change may affect the equity risk premium though at varying 

degrees. To manage this risk, the Manager analyses how interest rate changes 

may affect different industries and securities and then seeks to adjust the Fund’s 

portfolio investments accordingly. 

However, the effects of changes in interest rates on the Fund’s portfolio may not be 

quantified as the relationship between interest rates and the value of equity 

securities is indirect. Hence, no sensitivity analysis has been presented separately. 

(c) 

Market risk – Currency risk 

Currency risk is the risk that the value of a financial instrument will fluctuate due to 

changes in foreign exchange rates. 

To minimise currency risk, the Fund mainly holds its excess cash in its functional 

currency. For hedging purposes, the Fund may also enter into forward foreign 

exchange contracts. 

29






(c) Market risk - Currency risk 

The tables below summarise the Fund’s exposure to currency risks. 

USD 

S$ 

AUD 

S$ 

SGD 

S$ 

EUR 

S$ 


Assets 

Portfolio of investments 14,360,221 1,579,512 992,825 1,419,622 1,578,677 1,475,046 2,241,114 2,155,857 25,802,874 

Sales awaiting settlement 147,399 - - - 253 - - 337,312 484,964 

Receivables 183,902 16,760 117,556 - 5,961 7,532 - 1,733 333,444 

Cash and bank balances 32,484 - 804,441 20,799 7,064 3 13,598 4,048 882,437 

Total assets 14,724,006 1,596,272 1,914,822 1,440,421 1,591,955 1,482,581 2,254,712 2,498,950 27,503,719 

JPY 

S$ 

GBP 

S$ 

HKD 

S$ 

Others 

S$ 

Total 

S$ 

Liabilities 

Payables 105,927 - 342,077 - - - - 10,534 458,538 

Purchases awaiting settlement 186,729 - - - - - - 316,772 503,501 

Distribution payable - - 194,946 - - - - - 194,946 

Total liabilities 292,656 - 537,023 - - - - 327,306 1,156,985 

Net currency exposure 14,431,350 1,596,272 1,377,799 1,440,421 1,591,955 1,482,581 2,254,712 2,171,644 


USD 

S$ 

AUD 

S$ 

SGD 

S$ 

EUR 

S$ 

Assets 

Portfolio of investments 28,418,354 3,998,358 3,133,280 2,637,648 1,935,696 2,932,200 1,395,542 3,860,490 48,311,568 

Sales awaiting settlement 61,904 - - - - - - - 61,904 

Receivables 63,468 58,452 305,968 - 13,154 19,589 - 5,002 465,633 

Cash and bank balances 30,856 14 954,623 - - 3 23,012 1,141 1,009,649 

Total assets 28,574,582 4,056,824 4,393,871 2,637,648 1,948,850 2,951,792 1,418,554 3,866,633 49,848,754 

JPY 

S$ 

GBP 

S$ 

HKD 

S$ 

Others 

S$ 

Total 

S$ 

Liabilities 

Payables - - 485,916 - - - - - 485,916 

Purchases awaiting 

settlement 24,712 - - - - - - - 24,712 

Distribution payable - - 419,322 - - - - - 419,322 

Total liabilities 24,712 - 905,238 - - - - - 929,950 

Net currency exposure 28,549,870 4,056,824 3,488,633 2,637,648 1,948,850 2,951,792 1,418,554 3,866,633 

30






(c) 

Market risk - Currency risk (continued) 

Portfolio of investments, which is a significant item in the Statement of Financial 

Position is exposed to currency risk and other price risk. The Manager has 

considered the impact of currency risk sensitivity on non-monetary assets as part of 

the price risk sensitivity analysis. 

As at 30 June 2013 and 2012, the Fund does not hold substantial monetary 

assets/liabilities. Changes in foreign exchange rates on monetary assets/liabilities 

will not result in a significant change in the net asset value of the Fund. Hence, no 

separate sensitivity analysis on foreign currency risk has been presented. 

(d) 

Liquidity risk 

Liquidity risk is the risk of loss arising from the inability of the Fund to meet its 

obligations as and when they fall due without incurring unacceptable cost or losses. 

The Fund is exposed to daily cash redemptions from unitholders. However, in 

accordance with the Fund’s prospectus, minimum holdings and minimum 

redemption sise are set. 

To manage the liquidity risk, a cash buffer is maintained in the Fund and monitored 

for minimum cash balances to present any extensive disposition of assets which 

may occur at lower prices and overdraft situations to meet trade settlements and 

obligations. 

The Fund’s securities are considered readily realisable, as all the securities are 

listed on the recognised stock exchanges. 

The Fund’s financial liabilities and net settled derivatives financial liabilities are 

analysed using contractual undiscounted cashflows for maturity grouping based on 

the remaining period at the reporting date to the contractual maturity date. At the 

year end, all liabilities are due in less than 3 months. The impact of discounting is 

not significant. 

Less than 3 months 

As at As at 

30 June 30 June 

2013 2012 

S$ S$ 

Payables 458,538 485,916 



Contractual cash outflows 

(excluding gross settled derivatives) 1,156,985 929,950 

31






(e) 

Credit risk 

Credit risk is the risk that a counterparty will be unable to fulfill its obligations to the 

Fund in part or in full as and when they fall due. 

Concentrations of credit risk are minimised primarily by: 

– ensuring counterparties as well as the respective credit limits are approved; 

– ensuring there are controls in place to identify and assess the creditworthiness 

of counterparties and reviews such controls on a semi-annual basis; and 

– ensuring that transactions are undertaken with a large number of 

counterparties. 

All trade settlement with approved counterparties are on Delivery versus Payment 

and/or Receipt versus Payment basis, with the exception of initial public offerings, 

new issues and placement transactions. 

Credit risk arises from cash and bank balances and outstanding and committed 

transactions with brokers. The table below summarises the credit rating of banks 

and custodian in which the Fund’s assets are held as at 30 June 2013 and 30 June 

2012. 

Credit rating as 

at 30 June 2013 

Credit rating as 

at 30 June 2012 

Source of 

credit rating 

Bank balance 

- The Northern Trust Company - A+ Standard & Poor's 

- BNP Paribas Securities Services 

Singapore Branch A+ - Standard & Poor's 

Custodian 

- The Northern Trust Company - A+ Standard & Poor's 

- BNP Paribas Securities Services 

Singapore Branch A+ - Standard & Poor's 

As of 1 June 2013, the custodian of the Fund has changed to BNP Paribas 

Securities Services Singapore Branch. 

The credit ratings are based on Long-Term Local Issuer Ratings published by the 

rating Agency. 

The maximum exposure to credit risk at the reporting date is the carrying amount of 

the financial assets. 

32






(f) 

Specific risk of real estate companies 

Real estate companies are particularly vulnerable to, inter alia, the local and 

international economic climate, real estate market conditions such as oversupply or 

reduced demand for commercial and residential space, changes in market rental 

rates, depreciation of buildings over time, and increases in property taxes and 

interest rates. 

As real estate investments are relatively illiquid, this affects the ability of a REIT to 

vary its investment portfolio or liquidate part of its assets in response to changes in 

economic, real estate market, interest rats or other conditions. 

An increase in market interest rates may have an adverse impact on the market 

price of units in REITs if their annual yields give investors a lower return as 

compared to other investments. 

To manage such risks, the Manager seeks to diversify its investments between 

asset class i.e. listed real estate companies and REITs, and between securities 

within each class i.e. residential versus commercial properties, properties situated 

in different geographical area etc. 

(g) 

Capital management 

The Fund’s capital is represented by the net assets attributable to unitholders. The 

Fund strives to invest the subscriptions of redeemable participating units in 

investments that meet the Fund’s investment objectives while maintaining sufficient 

liquidity to meet unitholder redemptions. 

(h) 

Fair value estimation 

The fair value of financial assets and liabilities traded in active markets (such as 

publicly traded derivatives and trading securities) are based on quoted market 

prices at the close of trading on the reporting date. The quoted market price used 

for financial assets held by the Fund is the current bid price; the appropriate quoted 

market price for financial liabilities is the current asking price. When the Fund holds 

derivatives with offsetting market risks, it uses mid-market prices as a basis for 

establishing fair values for the offsetting risk positions and applies this bid or asking 

price to the net open position, as appropriate. 

33






(h) 

Fair value estimation (continued) 

The Fund classifies fair value measurements using a fair value hierarchy that 

reflects the significance of the inputs used in making the measurements. The fair 

value hierarchy has the following levels: 

• Quoted prices (unadjusted) in active markets for identical assets or liabilities 

(Level 1). 

• Inputs other than quoted prices included within level 1 that are observable for 

the asset or liability, either directly (that is, as prices) or indirectly (that is, 

derived from prices) (Level 2). 

• Inputs for the asset or liability that are not based on observable market data 

(that is, unobservable inputs) (Level 3). 

The following table analyses within the fair value hierarchy the Fund’s financial 

assets and liabilities (by class) measured at fair value as at 30 June 2013 and 

2012: 


Level 1 

S$ 

Level 2 

S$ 

Level 3 

S$ 

Total 

S$ 

Assets 

Financial assets 

designated at fair value 

through profit or loss at 

inception 

- Quoted equities 5,304,338 - - 5,304,338 

- Quoted real estate 

investment trust 20,498,536 - - 20,498,536 

25,802,874 - - 25,802,874 


Level 1 

S$ 

Level 2 

S$ 

Level 3 

S$ 

Total 

S$ 

Assets 

Financial assets 

designated at fair value 

through profit or loss at 

inception 

- Quoted equities 7,774,139 - - 7,774,139 

- Quoted real estate 

investment trust 40,537,429 - - 40,537,429 

48,311,568 - - 48,311,568 

Investments whose values are based on quoted market prices in active markets, 

and therefore classified within level 1, include active listed equities and investment 

funds. The Fund does not adjust the quoted price for these instruments. 

34






The Manager of the Fund is Nikko Asset Management Asia Limited, a subsidiary of 

Nikko Asset Management International Limited. As of 1 June 2013, The Trustee of 

the fund has been changed to BNP Paribas Trust Services Singapore Limited (the 

"Trustee"). 

In addition, the bank holding company and related parties of the Trustee have also 

provided custodian, banking, foreign exchange, fund administration and brokerage 

services to the Fund in the normal course of business at terms agreed between the 

parties and within the provisions of the Trust Deed. 

2013 

S$ 

2012 

S$ 

Bank balances held with related party of the trustee 882,437 - 

Brokerage expense on purchases and sales of 

investments charged by a related company of the 

Manager - 1,039 

Total value of trades done with a related company of 

the Manager - 519,389 

11. Financial ratios 

Expense ratio 

2013 2012 

Total operating expenses S$ 815,460 933,596 


Total expense ratio 1 % 1.87 1.75 

Turnover ratio 

2013 2012 

Lower of total value of purchases or sales S$ 25,731,091 34,158,245 


Total turnover ratio 2 % 58.89 64.11 

35





11. Financial ratios (continued) 

1 The expense ratio has been computed based on the guidelines laid down by the 

Investment Management Association of Singapore ("IMAS"). The calculation of the expense 

ratio at financial year end was based on total operating expenses divided by the average 

net asset value for the year. The total operating expenses do not include brokerage and 

other transactions costs, performance fee, interest expense, distribution paid out to 

unitholders, foreign exchange gains/losses, front or back end loads arising from the 

purchase or sale of other funds and tax deducted at source or arising out of income 

received. The Fund does not pay any performance fee. The average net asset value is 

based on the daily balances. 

2 The portfolio turnover ratio is calculated in accordance with the formula stated in the Code 

on Collective Investment Schemes. The calculation of the portfolio turnover ratio was based 

on the lower of the total value of purchases or sales of the underlying investments, divided 

by the average daily net asset value. In line with Statement of Recommended Accounting 

Practice 7 “Reporting framework for Unit Trusts” (“RAP 7”) issued by the Institute of 

Singapore Chartered Accountants in June 2012, total value of purchases or sales for the 

current year do not include brokerage and other transaction costs. 

12. Comparatives 

The 2012 comparative figures have been reclassified to conform with changes in 

the current presentation, in relation to the revised Recommended Accounting 

Practice 7 "Reporting Framework for Unit Trusts" issued by the Institute of 

Singapore Chartered Accountants in June 2012. 

36









Nil. 


10 Largest holdings at 30 June 2013 


net assets 


Fair value 

S$ 

unitholders 

% 

Simon Property Group Inc 1,841,480 6.99 

Prologis Inc 894,613 3.40 

Unibail-Rodamco SE 821,163 3.12 

Wharf Holdings Ltd 738,264 2.80 

Hongkong Land Holdings Ltd 642,380 2.44 

Ventas Inc 628,463 2.39 

Avalonbay Communities Inc 594,003 2.25 

Camden Property Trust 592,872 2.25 

Westfield Group 524,078 1.99 


10 Largest holdings at 30 June 2012 

Simon Property Group Inc 

Equity Residential 

Unibail-Rodamco SE 

Ventas Inc 

Wharf Holdings Ltd 

Westfield Group 

Health Care Reit Inc 

Hongkong Land Holdings Ltd 

Public Storage 

Prologis Inc 


Fair value 

S$ 


net assets 


unitholders 

% 

3,643,369 7.45 

1,603,118 3.28 

1,533,842 3.14 

1,430,837 2.92 

1,395,542 2.85 

1,366,088 2.79 

1,347,566 2.75 

1,330,850 2.72 

1,267,325 2.59 

1,249,311 2.55 

Nil. 


Nil. 

6. Collateral 

Nil. 

37






Nil. 

8. Investment in unit trusts, mutual funds and collective investment schemes 


9. Borrowings 

Nil. 

10. Amount of units created and cancelled for the financial year ended 30 June 2013 

Units created 3,645,912 

Units cancelled (30,495,867) 

11. Turnover ratio 

Please refer to Note 11 of the Notes to the financial statements on page 35. 

12. Expense ratio 




14. Any other material information that will adversely impact the valuation of the fund 

Nil. 

S$ 

38

Intentionally left blank.

Intentionally left blank.





SEMI-ANNUAL REPORT 

For the financial period ending 31 December 2012 



1

MANAGERS 





DIRECTORS 




Lim Say Boon 

V Arivazhagan 


Ng Soo Nam 


RBC Investor Services Trust Singapore Limited 

20 Cecil Street, #28-01 Equity Plaza 


AUDITORS 









Rodyk & Davidson LLP 

80 Raffles Place, #33-00 UOB Plaza 1 


CUSTODIAN 

The Northern Trust Company Singapore Branch 

One George Street, #12-06 



1



Since 

Inception 

Benchmark 1 4.14 4.97 17.69 11.20 9.12 10.43 


Securities Fund (S$) 2 3.06 4.08 15.78 7.92 -2.78 0.35 


on NAV-NAV basis, SGD, and based on the assumption that all dividends and distributions are reinvested, if any. Returns for period 



Since 

Inception 

Benchmark 1 4.14 4.97 17.69 11.20 9.12 10.43 


Securities Fund (S$) 2 -2.09 -1.12 9.99 6.09 -3.77 -0.31 


on a NAV-NAV basis, SGD, and based on the assumption that all dividends and distributions are reinvested, if any, and take into 



Since 

Inception 

Benchmark 1 4.58 8.86 24.93 16.49 12.76 14.82 


Securities Fund (US$) 2 3.55 7.98 22.99 13.05 0.44 4.30 


on NAV-NAV basis, USD, and based on the assumption that all dividends and distributions are reinvested, if any. Returns for period 



Since 

Inception 

Benchmark 1 4.58 8.86 24.93 16.49 12.76 14.82 


Securities Fund (US$) 2 -1.63 2.58 16.84 11.13 -0.58 3.61 


on a NAV-NAV basis, USD, and based on the assumption that all dividends and distributions are reinvested, if any, and take into 



(1) Benchmark: The Fund’s benchmark is the UBS Global Real Estate Investors Total Return Index. Prior 

to 1 March 2010, the benchmark was Yield Component of UBS Global Real Estate Investors Total 

Return Index. Prior to 1 April 2006, the benchmark was the UBS Global Real Estate Investors Total 

Return Index. 



There was an interim dividend of S$0.55 per 100 units held as of 31 December 2012. For the reinvestment 

of dividends, equivalent units will be created on the payment date 21 January 2013 for both the SGD 

and USD classes. 

2


Underperformed during the period under review 

During the six months under review, the Nikko AM Shenton Global Property Securities Fund (the “Fund”) 

delivered a return of 4.08%, underperforming its benchmark by 89bp. Our allocation decisions added 

value, particularly our overweight stance in Singapore and underweight stance in the U.S., mitigated by 

our cash holdings. Our stock selection however detracted from performance, particularly in the U.S., 

Japan and Singapore. This was partially offset by selections in Hong Kong and the U.K. 


Optimistic on North America 

We continue to be optimistic about U.S. economic growth. With the Presidential elections over and 

“fiscal cliff” as well as debt ceiling issues temporarily behind us, stocks could remain well-supported. Our 

expectation is that over time the political upheaval will settle down and the various stakeholders will find 

some common ground. From a monetary perspective we expect the Federal Reserve to continue with 

quantitative easing. In Canada, we expect the economy to continue to expand, driven by investments in 

its resource based industry. 

Economic winter likely to continue in Europe 

In Europe, the accommodative stance taken by the European Central Bank (“ECB”) continues to soothe 

the sovereign debt markets. Focus is likely to shift to the upcoming elections in Italy and Spain. Our 

expectation is that European economic growth in 2013 will be modest at best. Southern European 

countries continue with their austerity drive and their populations will bear the painful readjustments 

caused by it. We still expect slowing economic activity in Europe as austerity measures curb consumption. 

We continue to be pessimistic on the economic outlook of Southern Europe in the short run vis-à-vis 

Northern Europe and Scandinavia. On a positive note, talks of Greece and other Southern European 

countries exiting the European Union (“EU”) has completely faded away. 

Slowing growth to pose a challenge in the U.K. 

We continue to expect the U.K. to benefit from a relatively positive economic environment compared to 

Europe, but expect slowing growth to provide material headwinds. We also expect monetary policy to 

be supportive, given the austerity fiscal measures undertaken. Given the stable economic policies, we 

continue to expect the U.K. to be a preferred destination for capital. We continue to focus on specialty 

names with exposure to London. 

Japan likely to pursue loose monetary policy 

The Liberal Democratic Party has won the recent elections on a platform of defeating inflation with 

increasing fiscal stimulus, loose monetary policy and a weak JPY. We continue to expect accommodative 

monetary policy from the new Bank of Japan (“BoJ”) governor and we also expect an upward revision of 

the inflation target. We expect continued purchases of Japanese Real Estate Investment Trust (“J-REITs”) 

via the BoJ’s Asset Purchase Program. We feel that Grade A office vacancy has peaked, with rental 

increases possible in the later part of 2013. We also expect multiple primary and secondary offerings in 

the JREIT space. 

Asian valuations remain reasonable even though REIT yields have compressed 

We continue to believe that the economies in the Asia Pacific ex-Japan region will grow at a healthier 

pace compared to their developed market peers, which should be supportive of commercial real estate 

values and rents. We believe that valuations for Asian property stocks in general remain fair. While 

valuations are now more expensive for Asian REITs with yields having compressed over the last few 

months, we believe that attractive returns are still available with careful stock selection. We continue to 

believe that yields will compress modestly going forward on the back of a healthy appetite for incomeproducing 

instruments. We remain overweight the Asia Pacific ex-Japan region in our portfolio. 

3

Market Review 

Global property stocks gained across all major regions 

Global property stocks gained during the six months to December 2012, with the EPRA/NAREIT Global 

Index rising 11.2% in USD terms. Stocks in the Asia-Pacific and Europe gained the most, while those in 

the Americas lagged. 

U.S. property stocks edged up amidst fiscal uncertainties 

U.S. property stocks gained 0.8% during the period under review in USD terms, according to the FTSE 

EPRA/NAREIT U.S. Index. News flow during the period was focused on the U.S. Presidential elections as 

well as uncertainty regarding the “fiscal cliff”, which was not resolved until after the year-end. The ISM 

manufacturing PMI for December, at 50.7, was slightly better than expected. The U.S. unemployment 

rate, at 7.8% at the end 2012, was materially better than the 8.5% at the end of 2011. The Canadian 

unemployment rate as at the end of December was 7.1%, which was also better than expected. In 

notable company news, AvalonBay and Equity Residential agreed to a deal with Lehman Brothers to 

acquire Archstone Enterprise for about USD16b. Blackstone Real Estate Partners VII acquired a non-traded 

select-service hotel REIT for USD1.2b and HCP bought 133 senior housing communities for USD1.7b. 

European property stocks surged as the fiscal crisis abated 

European property stocks surged during the six months to December, with the FTSE EPRA/NAREIT 

Eurozone Index up 20.5% in USD terms. During the period, the European Central Bank continued to take 

steps to support sovereign bonds of the fiscally-troubled European nations. The repeated interventions 

have led to an easing in the immediate crisis, even though structural issues remain. Eurozone GDP 

shrank 0.1% Quarter-on-quarter (“QOQ”) and 0.6% Year-on-year (“YOY”) in 3Q12. Eurozone retail 

sales in October eased 1.2% Month-on-month (“MOM”) and 3.6% YOY. French Industrial production 

for November fell 3.6% YOY. Moody’s downgraded the credit rating of France from AAA to Aa1 with a 

negative outlook. In company news, TAG Immobilien issued 30m shares via a rights issue to finance the 

EUR471m acquisition of the TLG Wohnen portfolio. 

U.K. property stocks gained despite shrinking capital values 

U.K. property stocks gained 15.7% in USD terms during the period under review, as measured by the 

FTSE EPRA/NAREIT U.K. Index. In economic news, inflation eased to 2.7% in 2012 from 4.2% in 2011. 

Halifax house prices for November rose 1% MOM but year to date prices are down 1.3%. Capital values 

for investment properties continued to shrink for the 13th month, easing 0.5% MOM in November, 

according to Investment Property Databank. In company news, London & Stamford Property and Metric 

Property Investments announced an all share merger to create LondonMetric, a top-10 U.K. REIT with 

just under GBP1b in total assets. Hammerson bought a portfolio of four U.K. retail parks for GBP254m. 

Global investors continue to invest actively in London. 

Japanese property stocks climbed on continued central bank support 

Japanese property stocks climbed 20.6% in USD terms during the half-year, according to the FTSE EPRA/ 

NAREIT Japan Index. The election victory for the Liberal Democratic Party and Prime Minister Abe’s focus 

on beating deflation and weakening the JPY drove markets higher, with developers outperforming the 

J-REITs once results were announced. Industrial production in November fell down 5.8% YOY, which was 

worse than expected. The JPY closed the year at 86.75 JPY per USD, which was its lowest level in two 

years. The BoJ continued to keep an accommodative monetary policy and to buy J-REITs under the asset 

purchase program. In real estate news, Tokyo office vacancy dropped 9bp MOM to 8.67% at the end 

of December. GLP JREIT successfully listed in December, while Japan Retail Fund and Japan Real Estate 

successfully raised capital in the second half. 

4

Australian REITs gained as interest rates were cut 

Australian REITs (“A-REITs”) gained 11.0% in AUD terms during the period, according to the S&P/ASX 

200 A-REIT Index. After outperforming in the first half of 2012, the A-REITs underperformed Australian 

general equities in the second half by 2.1% on a total return basis. During the period, the Reserve Bank 

of Australia cut its cash rate by 50bp to 3.00%. While GDP growth remained steady, employment growth 

remained patchy, with net job losses in two out of six months. Major developments during the period 

include Lend Lease selling a 75% stake in two office towers in Barangaroo for AUD1.5b; Westfield 

Group and Westfield Retail Trust completing a AUD1.8b asset swap with AMP; the listing of Shopping 

Centres Australasia, which was spun off from Woolworths; and Goodman Group’s expansion into Brazil. 

Hong Kong property stocks surged as rents and home prices gained 

Hong Kong property stocks surged 27.6% in HKD terms during the half-year, according to the Hang 

Seng Property Index. Office rents continued to diverge during the period, according to the H.K. Rating 

and Valuation Department, rising in decentralized locations while staying unchanged in Central and 

Sheung Wan. Retail rents continued to grow, but at a pace which was slower than the first half-year. 

During the period, the government scrapped plans to redevelop its former office in Central, reducing 

future office supply by 200,000 sqf. The Link REIT approved an expansion of its investment scope, 

allowing it to acquire industrial buildings for conversion into shopping malls. Home prices rose 10.7% 

during the period despite several rounds of cooling measures, to reach a new all-time high in November, 

according to the Centa-City Leading Index. 

Singapore property stocks rose despite mixed rental trends 

Singapore property stocks also rose in the six months under review, with the FTSE ST Real Estate Index up 

21.6% in SGD terms. Office rents eased 0.4% while retail rents eased 0.1% during the period, according 

to the Urban Redevelopment Authority. Industrial rents gained 5.1%. Hotel RevPAR was broadly stable 

during the period under review. Private home prices gained 2.5% over the period, with new home sales 

remaining brisk, despite several rounds of cooling measures. Major developments during the period 

included the listing of hotel REITs Ascendas Hospitality Trust and Far East Hospitality Trust, and the 

acquisition of the office building Mapletree Anson by Mapletree Commercial Trust for SGD680m. 

5


This document is for information only with no consideration given to the specific investment objective, 

financial situation and particular needs of any specific person. Any securities mentioned herein are for 

illustration purposes only and should not be construed as a recommendation for investment. You should 

seek advice from a financial adviser before making any investment. In the event that you choose not to 

do so, you should consider whether the investment selected is suitable for you. Investments in unit trusts 

are not deposits in, obligations of, or guaranteed or insured by Nikko Asset Management Asia Limited 

(“Nikko AM Asia”). 





product highlights sheet obtainable from appointed distributors of Nikko AM Asia or our website ( 

www.nikkoam.com.sg) before investing. 

The information contained herein may not be copied, reproduced or redistributed without the express 

consent of Nikko AM Asia. While reasonable care has been taken to ensure the accuracy of the 

information as at the date of publication, Nikko AM Asia does not give any warranty or representation, 

either express or implied, and expressly disclaims liability for any errors or omissions. Information may be 

subject to change without notice. Nikko AM Asia accepts no liability for any loss, indirect or consequential 

damages, arising from any use of or reliance on this document. 

The CPF interest rate for the Ordinary Account (“OA”) is based on the 12-month fixed deposit and monthend 

savings rates of major local banks, subject to a minimum 2.5% interest per annum. The interest rate 

for Special, Medisave and Retirement Accounts (“SMRA”) is pegged to the 12-month average yield of 

10-year Singapore Government Securities yield plus 1%. A 4% floor rate will be maintained for interest 

earned on SMRA until 31 December 2013, after which a 2.5% minimum rate will apply. An extra 1% 

interest is paid on the first S$60,000 of a member’s combined balances, including up to S$20,000 in 

the OA. The first S$20,000 in the OA and the first S$40,000 in the Special Account (“SA”) cannot be 

invested under the CPF Investment Scheme (“CPFIS”). 


The Fund is offered only to professional investors and is not authorized by the Securities and Futures 

Commission in Hong Kong. The contents of this document have not been reviewed by any regulatory 

authority in Hong Kong. You are advised to exercise caution in relation to this document. If you are in any 

doubt about any of the contents of this document, you should obtain independent professional advice. 


6


The Managers and the Sub-Managers of the Nikko AM Shenton Global Property Securities Fund (the 

“Fund”) are entitled to and may currently receive soft-dollar commissions from, or enter into soft dollar 

arrangements with, stockbrokers who execute trades on behalf of the Fund. 

The soft dollars received would be restricted to the following kinds of services: 

• research and advisory services; 

• economic and political analysis; 

• portfolio analysis including valuation and portfolio measurement; 

• market analysis; 

• data and quotation services; 

• computer hardware and software or any other information facilities to the extent that they are used 

to support the investment decision making process; 

• custodial service in relation to the investment managed for clients; and 

• investment related publications. 

Soft dollar commissions/arrangements do not include: 

• travel, accommodation and entertainment expenses; 

• general administrative goods and services including office equipment and premises; 

• membership fees; 

• employees’ salaries; or 

• direct monies payments / rebates. 

The Managers and the Sub-Managers of the Nikko AM Shenton Global Property Securities Fund will not 

accept or into enter soft dollar commissions/arrangements unless: 

• such soft-dollar commissions/arrangements would in the opinion of the Managers / Sub-Managers, 

assist the Managers / Sub-Managers in their management of the Fund; 



• no unnecessary trades are entered into in order to qualify for such soft-dollar commissions/ 

arrangements. 

The Managers and the Sub-Managers of the Nikko AM Shenton Global Property Securities Fund will 

comply with applicable regulatory and industry standards on soft dollars. 

7




For the financial period ended 31 December 2012 (Unaudited) 

2012 2011 

S$ S$ 

Income 

Dividends 806,338 991,235 

Interest 34 590 

Other income 578 678 

806,950 992,503 


Management fees 357,352 422,785 

Registration fees 8,305 4,537 

Trustee fees 9,489 11,274 

Custody fees 9,191 5,112 

Valuation fees 10,675 12,684 

Audit fee 6,301 5,281 

Transaction fees 65,700 88,437 

Other expenses 28,052 32,679 

495,065 582,789 

Net Income 311,885 409,714 

Net gains or losses on value of investments and 

financial derivatives 

Net gains/(losses) on investments 1,754,646 (4,578,275) 

Net gains on financial derivatives - 313 


1,740,293 (4,618,339) 

Total return/(deficit) for the financial period before 

income tax 2,052,178 (4,208,625) 

Less: Income tax (156,987) (206,642) 

Total return/(deficit) for the financial period 1,895,191 (4,415,267) 

8




As at 31 December 2012 (Unaudited) 

31 Dec 2012 30 June 2012 

S$ S$ 

ASSETS 



Receivables 701,055 465,633 

Cash and bank balances 2,176,062 1,009,649 

Total assets 46,084,242 49,848,754 

LIABILITIES 

Payables 943,431 485,916 



Total liabilities 1,716,403 929,950 

EQUITY 

Net assets attributable to unitholders 44,367,839 48,918,804 

9



STATEMENT OF MOVEMENTS OF UNITHOLDERS’ FUNDS 


31 Dec 2012 30 June 2012 

S$ S$ 


beginning of the financial period 48,918,804 64,527,075 

Operations 

Change in net assets attributable to 

unitholders resulting from operations 1,895,191 942,011 




Change in net assets attributable to 

resulting from net creation 

and cancellation of units (5,673,204) (14,820,868) 

Distributions (772,952) (1,729,414) 

Total decrease in net assets attributable to 

unitholders (4,550,965) (15,608,271) 


end of the financial period 44,367,839 48,918,804 

10







Real Estates Companies 

Holdings at 

31 Dec 2012 

Percentage of 




31 Dec 2012 31 Dec 2012 

S$ % 


Hongkong Land Holdings Limited 140,940 1,201,664 2.71 

Total Bermuda 1,201,664 2.71 

CANADA 

Brookfield Office Properties 6,350 131,418 0.30 

First Capital Realty Incorporated 5,620 129,409 0.29 


CHINA (INCLUDING HONG KONG SAR) 

Hang Lung Properties Limited 137,000 662,830 1.49 

Total China (including Hong Kong SAR) 662,830 1.49 

GERMANY 

Tag Immobilien AG 25,210 383,740 0.87 


GREAT BRITAIN 

Capital & Counties Properties 189,460 910,360 2.05 

Unite Group Public Listed Company 94,970 520,823 1.17 

Total Great Britain 1,431,183 3.22 

JAPAN 

Aeon Mall Company Limited 6,000 179,358 0.41 


NORWAY 

Norwegian Property Asa 188,600 351,445 0.79 

Total Norway 351,445 0.79 

SINGAPORE 

Global Logistic Properties Limited 120,000 333,600 0.75 


SWEDEN 



SWITZERLAND 

PSP Swiss Property AG 4,530 523,204 1.18 

Total Switzerland 523,204 1.18 

THAILAND 

Ananda Development Public Company Limited 3,072,000 471,043 1.06 

Amata Corp Public Coltd-Nvdr 646,700 418,337 0.94 

Total Thailand 889,380 2.00 

Total Real Estates Companies 6,862,206 15.46 

11






Quoted Equities (continued) 

Real Estate Investment Trusts (REITS) 

Holdings at 

31 Dec 2012 

Percentage of 




31 Dec 2012 31 Dec 2012 

S$ % 

AUSTRALIA 

Centro Retail Australia 285,260 806,715 1.82 

Goodman Group 168,381 916,062 2.06 

Stockland 103,781 458,006 1.03 

Westfield Group 83,773 1,112,308 2.51 



CANADA 

Allied Properties Real Estate 2,840 114,799 0.26 

Boardwalk Real Estate Investment 1,680 132,542 0.30 

Calloway Real Estate Investment Trust 5,640 199,959 0.45 

Canadian Apartment Properties 4,370 132,846 0.30 

Chartwell Seniors Housing Real Estate Investment Trust 12,360 164,670 0.37 

Dundee Real EST -A-/REIT 2,340 107,420 0.24 



Champion Real Estate Inv Trust 901,000 521,116 1.18 

Hui Xian Real Estate Investment Trust 610,000 492,733 1.11 

Total China (Including Hong Kong SAR) 1,013,849 2.29 

FRANCE 

Unibail-Rodamco SE 5,650 1,655,545 3.73 

Total France 1,655,545 3.73 

GERMANY 

Alstria Office Real Estate Investment Trust-AG 34,190 511,016 1.15 


GREAT BRITAIN 

British Land Co Public Listed Company 35,630 397,587 0.90 

Land Securities Group Public Listed Company 50,030 807,609 1.82 

London & Stamford Property Public Listed Company 137,620 294,565 0.66 

Total Great Britain 1,499,761 3.38 

JAPAN 

GLP J-REIT 156 145,893 0.33 

Mori Trust Sogo REIT Incorporated 79 809,129 1.82 

Nippon Building Fund Incorporated 51 641,229 1.45 

Total Japan 1,596,251 3.60 

NETHERLANDS 

Vastned Retail NV 3,830 202,000 0.46 

Total Netherlands 202,000 0.46 

12







Holdings at 

31 Dec 2012 

Percentage of 




31 Dec 2012 31 Dec 2012 

S$ % 

SINGAPORE 

CDL Hospitality Trust 286,000 537,680 1.21 

Far East Hospitality Trust 263,000 263,000 0.59 

Mapletree Industrial Trust 400,000 542,000 1.22 



American Campus Communities Incorporated 6,410 360,954 0.81 

Avalonbay Communities Incorporated 3,370 557,985 1.26 

Boston Properties Incorporated 7,600 982,276 2.21 

BRE Properties Incorporation - A 3,900 242,051 0.55 


Developers Diversified Realty Corporation 23,730 453,344 1.02 

Diamondrock Hospitality Company 13,870 152,480 0.34 

Digital Realty Trust Incorporated 7,340 608,150 1.37 


Equity Residential 17,390 1,203,140 2.71 

Essex Property Trust Incorporated 3,540 634,347 1.43 

First Industrial Realty Trust Incorporated 11,550 198,504 0.45 

General Growth Properties Incorporated 17,840 432,780 0.98 

HCP Incorporated 17,390 959,283 2.16 

Health Care Reit Incorporated 13,270 993,468 2.24 

Highwood Properties Incorporated 4,800 196,124 0.44 

Host Hotels & Resorts Incorporated 25,800 493,835 1.11 


Lasalle Hotel Properties 14,140 438,709 0.99 



Mack-Cali Realty Corporation 8,630 275,345 0.62 

National Retail Properties 13,910 529,951 1.20 

Piedmont Office Realty Trust Incorporated - A 16,460 363,112 0.82 

Prologis Incorporated 27,630 1,231,538 2.78 

Public Storage 6,230 1,103,213 2.49 

RLJ Lodging Trust 10,520 248,779 0.56 

Simon Property Group Incorporated 15,660 3,024,053 6.82 


Spirit Realty Capital Incorporated 3,960 85,811 0.19 

Tanger Factory Outlet Center 13,680 571,152 1.29 

UDR Incorporated 27,400 795,895 1.79 

Ventas Incorporated 14,310 1,130,934 2.55 


Total United States Of America 22,112,202 49.85 

Total Real Estate Investment Trusts (REITS) 34,315,146 77.35 

13







Diversified Holding Companies 

Holdings at 

31 Dec 2012 

Percentage of 




31 Dec 2012 31 Dec 2012 

S$ % 


Wharf Holdings Limited 143,300 1,358,393 3.06 

Total China (including Hong Kong SAR) 1,358,393 3.06 

Total Diversified Holding Companies 1,358,393 3.06 

Lodging 

Singapore 

Overseas Union Enterprise 187,000 519,860 1.17 


Total Lodging 519,860 1.17 


Other net assets 1,312,234 2.96 


14





By Geography (Summary) Percentage of Percentage of 

total net assets total net assets 





31 Dec 12 30 June 12 

% % 




Canada 2.51 2.78 

China (Including Hong Kong SAR) 6.84 3.14 

France 3.73 1.09 

Germany 2.02 6.00 

Great Britain 6.60 3.76 

Japan 4.01 3.96 

Netherlands 0.46 1.16 

Norway 0.79 0.78 


Sweden 1.45 1.37 

Switzerland 1.18 1.21 

Thailand 2.00 0.83 


Total Quoted Equities 97.04 98.75 

Portfolio of investments 97.04 98.75 

Other net assets 2.96 1.25 

Net assets attributable to unitholders 100.00 100.00 

15





By Industry (Secondary) Percentage of Percentage of 

total net assets total net assets 

Fair value at 





31 Dec 12 31 Dec 12 30 June 12 

S$ % % 

Real Estate Companies 6,862,206 15.46 12.48 

Real Estate Investment Trusts (REITS) 34,315,146 77.35 82.87 

Diversified Holding Companies 1,358,393 3.06 2.85 

Lodging 519,860 1.17 0.55 


Other net assets 1,312,234 2.96 2.08 


16









Not applicable. 


10 Largest holdings at 31 Dec 2012 Fair Value 

Percentage of 

total net 

assets 


unitholders 

S$ % 

Simon Property Group Incorporated 3,024,053 6.82 


Wharf Holdings Limited 1,358,393 3.06 

Prologis Incorporated 1,231,539 2.78 



Ventas Incorporated 1,130,934 2.55 

Westfield Group 1,112,308 2.51 


Health Care Reit Incorporated 993,468 2.24 

10 Largest holdings at 31 Dec 2011 Fair Value 

Percentage of 

total net 

assets 


unitholders 

S$ % 

Simon Property Group Incorporated 3,487,585 6.40 

Ventas Incorporated 1,931,507 3.54 



The Macerich Company 1,636,316 3.00 

Health Care Reit Incorporated 1,436,753 2.63 

Prologis Incorporated 1,381,274 2.53 



Mori Trust Sogo Reit Incorporation 1,276,798 2.34 

17






NIL 


NIL 

6. Collateral 

NIL 


NIL 

8. Investment unit trust, mutual fund and collective investment schemes 

Percentage of 

Total net assets 


Fair Value at unitholders at 

31 Dec 12 31 Dec 12 

S$ % 

Real Estate Investment Trusts (REITS) 34,315,146 77.35 

9. Borrowings 

NIL 

10. Amount of redemptions and subscriptions for the period 

2012 

S$ 

Redemptions 7,408,407 

Subscriptions 1,735,203 

18





11. Financial ratio 

2012 2011 

% % 

Expense ratio (a) 1.77 1.75 

Turnover ratio (b) 25.68 32.32 

(a) 

The expense ratio has been computed based on the guidelines laid down by the Investment 

Management Association of Singapore ("IMAS"). The calculation of the expense ratio at 2012 was 

based on total operating expenses of S$868,863 (2011: S$1,060,395) divided by the average net 

asset value of $48,957,544 (2011: S$60,597,437) for the year. The total operating expenses do not 

include (where applicable) brokerage and other transaction costs, performance fee, interest 

expense, distribution paid out to unitholders, foreign exchange gains/losses, front or back end loads 

arising from the purchase or sale of other funds and tax deducted at source or arising out of income 

received. The Fund does not pay any performance fee. The average net asset value is based on 

the daily balances. 

(b) The portfolio turnover ratio is calculated in accordance with the formula stated in the Code on 

Collective Investment Schemes. The calculation of the portfolio turnover ratio was based on the 

total value of purchases of the underlying investments of S$12,113,565 (2011: S$18,035,704) 

divided by the average daily net asset value of S$47,174,357 (2011: S$55,803,541). 


The Manager of the Fund is Nikko Asset Management Asia Limited, a subsidiary 

of Nikko Asset Management International Limited. The Trustee is RBC Investor 

Services Trust Singapore Limited, a subsidiary of RBC Investor Services Limited. 

In addition to related party information disclosed elsewhere in the financial 

statements, the following significant related party transactions took place during 

the financial year between the fund and related parties at term agreed between 

the party and within the provisions of the Deeds: 

2012 2011 

S$ S$ 

Brokerage expenses on purchases and sales 

of investments charged by a related 

company of the Manager* - 7,284 

Total value of trades done with a related 

company of the Manager* - 2,112,752 

*For the period from 01 July 2011 to 29 Sep 2011. 

13. Any other material information that will adversely impact the valuation of the 

fund 

NIL 

19





14. Adoption of Revised Recommended Accounting Practice RAP 7 

The Fund has adopted the recommendations of Statement of Recommended 

Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute 

Certified Public Accountants of Singapore in June 2012 for the financial year of 

beginning 1 July 2012. Certain comparative figures have been reclassified to conform 

with changes in the current presentation. 

20

Report - Nikko AM Asia Limited

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