Shinhan Asset Management Launches 'Global REITs Infrastructure Fund' with 2.5 Billion Seed Capital

[Asia Economy Reporter Junho Hwang] Shinhan Asset Management has invested 2.5 billion KRW in a fund that invests in global REITs and infrastructure-related companies. Since asset management firms typically make seeding investments of around 200 million KRW, this move is analyzed as a strategic investment step.

Shinhan Asset Management completed the seeding investment for the 'Shinhan Global REITs Infrastructure Real Estate No.1 (H)' fund, launched in 2006, on the 19th. The Shinhan Global REITs Infrastructure Real Estate No.1 (H) fund is a fund of funds that selectively invests in REITs and infrastructure companies with relatively high dividend payout ratios.

Shinhan Asset Management decided to invest in this fund considering the current investment environment, where expectations for economic activity resumption after COVID-19 are concentrated while various risk factors persist. The fund aims for lower volatility compared to stocks while expecting stable dividend income. In the U.S., economic activity resumption expectations are growing, with announcements such as the number of job openings exceeding 10 million at the end of June this year. As economic activity increases, interest in and price rises in the real estate market, mainly in developed countries, are being observed. In particular, the U.S. government's large-scale infrastructure investment intentions and policy announcements are restoring investment sentiment toward REITs and infrastructure overall.

Individual investors who subscribe to this fund this year can also receive tax benefits. Public REITs and real estate funds offer a benefit where dividend income is subject to a separate tax rate of 9.9% for investment amounts up to 50 million KRW aggregated across all financial institutions. The separate taxation period is within three years from the investment date, and separate tax filing is possible only for subscriptions made by the end of this year.

Kim Choong-sun, CMO (Executive Director) of Shinhan Asset Management, said, "Considering the challenging market environment, Shinhan Asset Management is making considerable efforts to diversify investment opportunities for investors. As part of these efforts, we decided to make a seeding investment to strategically nurture the Global REITs Infrastructure Real Estate No.1 fund."

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