morgan stanley prime property fund annual report

May not sum to 100% due to the exclusion of other assets and liabilities. A description of the policies and procedures that the Fund uses to vote proxies relating to portfolio securities is available without charge upon request by calling toll-free 888-926-2688, or on the Securities and Exchange Commissions (SEC) website at http://www.sec.gov. The fund is in this category because it invests in property company shares and the fund's simulated and/or realised return has experienced very high rises and falls historically. Aggregate Bond Index in each of the since inception, trailing one year, and year to date through May 31, 2016 periods. The source for all performance and index data is Morgan Stanley Investment Management Limited. See how you can make meaningful contributions as a student or recent graduate at Morgan Stanley. CERTIFIED SHAREHOLDER REPORT OF REGISTERED, (Exact name of registrant as specified in charter), (Address of principal executive offices) (Zip code), Report of Independent Registered Public Accounting Firm, Trustees Consideration and Approval of Renewal of Advisory Agreements. In considering whether to approve the Investment Sub-Advisory Agreement, the Trustees reviewed and considered the information they deemed reasonably necessary, including the following material factors: (i) the nature, extent, and quality of the services provided by CenterSquare; (ii) theinvestment performance of the Fund and CenterSquare; (iii) the costs of the services provided and profits realized by CenterSquare and its affiliates from the relationship with the Fund; (iv) the extent to which economies of scale would be realized as the Fund grows and whether advisory fee levels reflect those economies of scale for the benefit of the Funds investors; (v) CenterSquares practices regarding brokerage and portfolio transactions; and (vi) CenterSquares practices regarding possible conflicts of interest. The Repurchase Offer Amount will be no less than 5% and no more than 25% of the total number of shares outstanding on the Repurchase Request Deadline. Following further discussion of the Funds current and projected asset levels, expectations for growth, and levels of fees, the Board determined that the Funds fee arrangements were fair and reasonable in relation to the nature and quality of the services provided by CenterSquare. Morgan Stanley Real Estate's Prime Property Fund Forms Joint Venture Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. Based upon all of the foregoing considerations, the Board of Trustees, including a majority of the Independent Trustees, approved the continuation of the Investment Advisory Agreement for the Fund. After further review and discussion, the Board determined that CenterSquares practices regarding brokerage and portfolio transactions were satisfactory. Quarterly repurchases by the Fund of its shares typically will be funded from available cash or sales of portfolio securities. Fund performance current to the most recent month-end is available by calling 1-888-926-2688 or by visiting www.griffincapital.com. Learn how we strive to deliver results for our shareholders. The Fund files a complete listing of portfolio holdings for the Fund with the SEC as of the first and third quarters of each fiscal year on Form N-Q. Each class represents an interest in the same assets of the Fund and classes are identical except for differences in their sales charge structures and ongoing service and distribution charges. Description Morgan Stanley Real Estate Prime Property Fund is a real estate core fund managed by Morgan Stanley Real Estate Advisors. All rights reserved. In these offers, the Fund offered to repurchase up to 5% of the number of its outstanding shares as of the Repurchase Pricing Dates. The Adviser will provide conspicuously displayed information in its Disclosure Document summarizing this proxy voting policy and procedures, including a statement that the Clients and Investors may request information regarding how the Adviser voted a Clients Proxies, and that the Clients and Investors may request a copy of these policies and procedures. The NFI-ODCE, short for National Council of Real Estate Investment Fiduciaries (NCREIF) Fund Index - Open End Diversified Core Equity, is the first of the NCREIF Fund Database products and is an index of investment returns reporting on both a historical and current basis the results of 24 open-end commingled funds pursuing a core investment strategy, some of which have performance histories dating back to the 1970s. The percentage represents a single distribution from the Fund and does not represent the total return of the Fund. NCREIF will calculate the overall aggregated Index return. Counsel with preschool director around staff, school programs and best practices. Past performance is no guarantee of future results. In considering the Advisers practices regarding conflicts of interest, the Trustees evaluated the potential for conflicts of interest and considered such matters as the experience and ability of the advisory personnel assigned to the Fund; the basis of decisions to buy or sell securities for the Fund and the Advisers other accounts; the method for bunching of portfolio securities transactions; and the substance and administration of the Advisers code of ethics. The use of leverage increases risks, such that a relatively small movement in the value of an investment may result in a disproportionately large movement, unfavourable as well as favourable, in the value of that investment and, in turn, the value of the Fund. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Statement of Assets and Liabilities. Generally, each Trustee and officer serves an indefinite term or until certain circumstances such as his resignation, death, or otherwise as specified in the Funds organizationaldocuments. Morgan Stanley Prime Property Fund $1.1 billion Fund Redemption Queue Balances AEW Core Property Trust $160.0 million, 2.0% of $8.0 billion of Fund NAV Heitman America Real Estate Trust $1.2 billion, 11.5% of $10.4 billion of Fund NAV Morgan Stanley Prime Property Fund $0.0 million, of $34.1 billion of Fund NAV As of . Andrew Slimmon, lead portfolio manager of the Applied Equity Advisors suite of funds and strategies shares his TAKE -- Takeaways & Key Expectations on the financial markets. We live that commitment through long-lasting partnerships, community-based delivery and engaging our best assetMorgan Stanley employees. Adjusted for initial maximum sales charge of 5.75%. We rely on our technologists around the world to create leading-edge, secure platforms for all our businesses. In some cases you might pay less, you can find this out from your financial adviser.Ongoing Chargesreflect the payments and expenses incurred during the fund's operation and are deducted from the assets of the fund over the period. The Trustees also noted that CenterSquares fee, combined with the Advisers fee, were similar to the management fees for funds with similar investment strategies. The Clients are permitted to place reasonable restrictions on the Advisers voting authority; Non-discretionary Clients may elect to retain full discretion regarding Proxies. The vehicle will invest in a diverse array of core properties throughout Western Europe. Learn from our industry leaders about how to manage your wealth and help meet your personal financial goals. Morgan Stanley Prime Property Fund. Get the latest insights, analyses and market trends in our newsletter, podcasts and videos. A negative correlation of -1 indicates that the securities have moved in the opposite direction. As of Reported distributions from net investment income and realized gains on investments are not an indication as to whether or not the Funds distributions are supported by the Funds returns. During the year ended September 30, 2016, the fee waiver was as follows: As of September 30, 2016, the balance of recoupable expenses for the Fund was as follows: Sub-advisory services were provided to the Fund pursuant to agreements between the Adviser and both Aon Hewitt Investment Consulting, Inc. (formerly doing business as Hewitt EnnisKnupp, Inc.) and CenterSquare Investment Management, Inc. (the Sub-Advisers). At September 30, 2016, outstanding collateral amounted to $1,066,237,965. The Investment Pool holds external and internal endowments and other long term cash holdings. Prime Property Fund Asia is a real estate opportunistic fund managed by Morgan Stanley. Additionally, Dr. Anderson serves as the Chief Economist of Griffin Capital Corporation, a position he has held since joining Griffin Capital Corporation in 2014. The Trustees noted that the Fund commenced operations on June 30, 2014, and continued to gather assets. The Funds distribution policy is to make quarterly distributions to shareholders. These factors contributed to positive net returns with low volatility and low correlation to the broader markets. Morgan Stanley Prime Property Fund is an open-end core fund with a focus on office, retail, multifamily, . . It also contained information on Fund expenses, including comparative expense ratio information for other investment companies with strategies similar to the Fund. Demand continues to outstrip supply, which has helped keep vacancy rates below their long-term averages and prompt favorable conditions for landlords to increase rents for most asset types. Morgan Stanley Prime Property Fund - Staff Memo.pdf. The value of the investments and the income from them will vary and there can be no assurance that the Fund will achieve its investment objectives. The Trustees noted the Funds success in gathering assets and that its assets under management as of May 31, 2016 exceeded all but one Fund in its peer group. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. The views expressed represent an assessment of market conditions at a specific point in time, are opinions only and should not be relied upon as investment advice regarding a particular investment or markets in general. Includes all wholly owned debt and PRIME's proportionate share of joint venture debt. Audit Committee of Listed Registrants. PDF Prime Property Fund - Nebraska Following further consideration and discussionof the foregoing, the Board concluded that the fees to be paid to CenterSquare by the Fund were fair and reasonable in relation to the nature and quality of the services provided by CenterSquare and that they reflected charges that were within a range of what could have been negotiated at arms length. Whether its hardware, software or age-old businesses, everything today is ripe for disruption. After reviewing the foregoing information and further information in the memorandum from CenterSquare (e.g., CenterSquares Form ADV and descriptions of the Advisors business and compliance program), the Board concluded that the nature, extent, and quality of the services to be provided by CenterSquare were satisfactory and adequate for the Fund. There may be an insufficient number of buyers or sellers which may affect the funds ability to buy or sell securities. The Trustees reviewed the balance sheet of CenterSquare and discussed the financial stability and profitability of the firm. The Fund currently offers Class A, Class C and Class I shares. 1.2% JLL Income Property Trust 3.3 78 5.6% Morgan Stanley Prime Property Fund 31.9 444 3.6% Principal Enhanced Property Fund 3.8 54 7.2% PRISA LP 26.1 250 3.0% Prologis Targeted U.S. Everything we do at Morgan Stanley is guided by our five core values: Do the right thing, put clients first, lead with exceptional ideas, commit to diversity and inclusion, and give back. The Fund is a closed-end interval fund that provides liquidity to shareholders through a quarterly repurchase offer. SEC.gov | HOME Select a trending topic or type your . The Fund distribution rate is the amount, expressed as a percentage, a Fund investor would receive in distributions if the most recent Fund distribution stayed consistent going forward. The Trustees noted that AHIC does not engage in portfolio transactions directly on behalf of the Fund and makes recommendations to the Adviser. Audit Committee Financial Expert. As of September 30, 2016, Dr. Anderson and Mr. Propper were responsible for the management of the following types of accounts in addition to the Fund: Item 9. In considering the nature, extent, and quality of the services provided by CenterSquare, the Trustees considered the responsibilities of CenterSquare under the Investment Sub-AdvisoryAgreementand reviewed the services provided to the Fund including, without limitation, CenterSquares procedures for formulating investment recommendations and assuring compliance with the Funds investment objectives and limitations, coordination of services for the Fund among the Funds service providers, and efforts to promote the Fund, grow the Funds assets, and assist in the distribution of Fund shares. Total returns are for the period indicated and have not been annualized. A timely analysis of market-changing events and their impact on the investment landscape. In considering the extent to which economies of scale would be realized as the Fund grows and whether the advisory fee levels reflect these economies of scale for benefit of the Funds investors, the Trustees considered that the Funds fee arrangements with AHIC and noted that the sub-advisory fee contained break points, which caused the Adviser to pay lower fees to AHIC based on lower asset levels. Morgan Stanley helps people, institutions and governments raise, manage and distribute the capital they need to achieve their goals. From our origins as a small Wall Street partnership to becoming a global firm of more than 60,000 employees today, Morgan Stanley has been committed to clients and communities for 85 years. The Funds Private Allocation Sub-Advisor, Aon Hewitt Investment Consulting, an Aon Company, provides investment consulting services to over 480 clients in North America with total client assets worldwide of approximately $4 trillion, including more than $3 trillion in the U.S. as of December 31, 2015. The value of investments and the income from them can go down as well as up and investors may lose all or a substantial portion of his or her investment. Stay abreast of the latest trends and developments. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The Distributor serves as principal underwriter of shares of the Fund. The tax character of the Funds distributions, in isolation, does not reveal much information about whether the distributions are supported by the Funds returns. It should not be assumed that any investment will be profitable or will equal the performance of the fund(s) or any securities or any sectors mentioned herein. Griffin Capital Advisor along with CenterSquare Investment Management have designed a public market strategy in line with the objectives of the Fund with a focus on identifying public real estate securities whose current prices are below their intrinsic values. The Trustees noted that CenterSquare assists the Adviser in seeking to achieve the Funds investment objective to generate a balanced return comprised of current income and capital appreciation with moderate volatility and low correlation to the broader markets by pursuing strategically investing across private institutional real estate investment funds as well as a diversified set of public real estate securities. The ratios of expenses to average net assets and net investment income to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. Additionally, Mr. Propper serves as Vice President, Product Development of Griffin Capital Corporation, a position he has held since joining Griffin Capital Corporation in 2014. In considering CenterSquares practices regarding brokerage and portfolio transactions, the Trustees reviewed CenterSquare standards, and performance in utilizing those standards, for seeking best execution for Fund portfolio transactions. US CORE STRATEGY. PRIME's assets include office, retail, multifamily, industrial, self storage and hotel properties and are located in major real estate markets throughout the United States. The Fund's Class I shares commenced operations on August 10, 2015. Sustainability factors can pose risks to investments, for example: impact asset values, increased operational costs. If a material conflict of interest exists for the Adviser, the Legal Department will determine how to vote the Proxy. Borrowings under the BNP arrangement bear interest at the 3 month LIBOR plus 95 basis points at the time of borrowing. The Fund is actively managed, and the management of the fund is not constrained by the composition of the Benchmark. As such this category may change in the future. For further details, please see our Terms of Use. As of September 30, 2016, the Fund had $1,066,237,965 of the private and public securities pledged as collateral for its lines of credit. The WAL calculation utilizes a security's stated final maturity date or, when relevant, the date of the next demand feature when the fund may receive payment of principal and interest (such as a put feature). 2007. Since our last annual report (September 2015), we added five additional best in class private institutional real estate securities, which represents an increase of $73 billion in gross asset exposure and 1,195 additional assets to the portfolio. As of September 30, 2016, the Fund had $65,000,000 of outstanding borrowings relating to BNP. The Trustees noted that the Expense Limitation Agreement the Adviser had agreed to in order to help limit the Funds annual operating expenses was still in effect and that to date, fund expenses have exceeded the Expense Limitation Agreement. Item 8. Additionally, at the Lakemont Group, Mr. Propper was responsible for overseeing projects for a variety of clients including pension funds, private equity firms and publicly traded real estate companies and specialized in structured finance, market analysis and strategic due diligence. Absent material conflicts, the President of the Adviser, in consultation with the Investment Committee, will determine how the Adviser should vote the Proxy in accordance with applicable voting guidelines (see below), taking into account the recommendation of the Portfolio Manager. ALPS Fund Services, Inc. serves as the Funds administrator and accounting agent (the Administrator) and receives customary fees from the Fund for such services. Previously, Dr. Anderson held several senior executive positions at Bluerock Real Estate LLC., including founding partner of the Bluerock Total Income + Real Estate Fund where he was the portfolio manager. DST Systems, Inc. serves as transfer, dividend paying and shareholder servicing agent for the Fund (the Transfer Agent). ^_g:L&NhK8F^3h$w#i!Efi8_2:,qEiwy el8byN4ly?9X t17%FL{WaTj^`MsAn yf]^}|*5GN-upxE4d: ePEfj>+r*x,sXjL]zEZgplC- [:6// DxD@ *(*otc-ABVafZW\jUU\u/0NF$-z'v'xMg; PRIME's net return for 3Q19 is 1.4% and since inception is 8.1%. As of September 30, 2016, net unrealized appreciation/(depreciation) of investments based on the federal tax cost was as follows: Gross Appreciation (excess of value over tax cost), Gross Depreciation (excess of tax cost over value), Cost of Investments for Income Tax Purposes. You cannot invest directly in an index. In considering the extent to which economies of scale would be realized as the Fund grows and whether the advisory fee levels reflect these economies of scale for benefit of the Funds investors, the Trustees considered that the Funds fee arrangements with CenterSquare and noted that the sub-advisory fees contained break points, which caused the Adviser to pay CenterSquare lower fees at lower asset levels. . We offer scalable investment products, foster innovative solutions and provide actionable insights across sustainability issues. 6.b. For the year ended September 30, 2016, the Distributor received $1,550,339 in underwriting commissions for sales of the Funds Class A shares, of which $0 was retained by the principal underwriter or other affiliated broker-dealers. The filings are available upon request by calling 888-926-2688. Total returns would have been lower had certain expenses not been waived during the period. from your original investment) and not a return of net profit. It includes fees paid for investment management (Management Fee), trustee/custodian, and administration charges.TheMinimum Initial Investment/Minimum Subsequent Investmentamounts may be in US Dollars (or the Euro Yen or Sterling equivalent of the US Dollar amount).For more information please see the Charges and Expenses section of the prospectus. The Fund may use the fair value of a security to calculate its NAV when, for example, (1) a portfolio security is not traded in a public market or the principal market in which the security trades is closed, (2) trading in a portfolio security is suspended and not resumed prior to the normal market close, (3) a portfolio security is not traded in significant volume for a substantial period, or (4) the Adviser determines that the quotation or price for a portfolio security provided by a broker-dealer or independent pricing service is inaccurate. Morgan Stanley Real Estate Investing. GRIFX Performance & Stats | Apollo Diversified Real Estt I - YCharts Holdings are subject to change. We provide comprehensive workplace financial solutions for organizations and their employees, combining personalized advice with modern technology. Please click here for additional performance disclosures and important information, which should be reviewed carefully. Management has reviewed the tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken in the Funds 2014 and2015 returns or expected to be taken in the Funds 2016 returns. Aggregate Bond Index is a market value-weighted index of investment grade fixed-rated debt issues, including government, corporate, asset-backed and mortgage-backed securities with a maturity of one year or more. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.Past performance is no guarantee of future results. 4.76%---- Cortland Growth And Income Fund, L.P. 4.71%-- . 808 0 obj <>stream Pursuant to Section 852(b)(3) of the Internal revenue Code, the Fund designated $1,881,291 as long-term capital gain distribution for the year ended September 30, 2016. The Adviser is responsible for the allocation of, or in the case of the Non-discretionary Client, recommendations regarding the allocation of, assets on behalf of the Clients to Underlying Funds, which may include hedge funds and other alternative investment pools that are structured as limited partnerships, limited liability companies or offshore corporations. Past performance is not a guarantee of future results. Situations may arise in which more than one Client invests in the same Underlying Fund. Morgan Stanley Prime Property Fund Llc. PRIME, a $6.3 billion diversified core real estate fund, is managed by Morgan Stanley Real Estate. Fund Documents | J.P. Morgan Asset Management Logistics Holdings, LP 15.3 715 4.8% RREEF America REIT II 15.1 109 3.6% RREEF Core Plus Industrial Fund 1.1 22 3.6% Sentinel Real Estate Fund 1.8 29 3.2% . There are additional risks associated with investing in real estate. The Funds investment adviser is Griffin Capital Advisor, LLC (the Adviser). hbbd```b``fA$zHvK'dV&60,+&;@w@c3"-vH`-9`WLL`4$30 0 t The Fund is now invested in 23 private and non-listed institutional real estate funds representing more than 2,600 properties in $188 billion of real estate. The Administrator is also reimbursed by the Fund for certain out of pocket expenses. All classes of shares have equal voting privileges except that each class has exclusive voting rights with respect to its service and/ordistribution plans. Shareholders should note that return of capital will reduce the tax basis of their shares and potentially increase the taxable gain, if any, upon disposition of their shares.