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The specialist property funds had modest beginnings in 1996, when Marriot, a niche Durban-based manager, launched its property fund as a collective investment. At the time there was confusion between it and the listed vehicles also known as property unit trusts (but now, to reduce confusion, called real estate investment trusts). Some even confused these new products with property syndications, which had been the easiest way for private investors to get exposure to the property sector, though usually to a single property such as a mid-sized shopping centre. Property was out of favour at the time, and the sector had a limited selection of shares. Yet any early adopter of these property equity funds would have done very well.

Property funds account for 4% of the unit trust industry’s assets, or R71.9bn, which is higher than the R53.3bn invested in bond funds. And it is interesting to compare the success of the fad sectors of the late 1990s: the technology fund sector has been di...

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