ING to clarify TU case to investors

       ING Funds plans to call a meeting of investors in the TU Dome Residential Complex Property Fund (TU-PF) next month to clarify the recent sanctions imposed against it by securities regulators.
       The Securities and Exchange Commission fined ING Funds 1.9 million baht and placed its president, Maris Tarab, on probation for three years for fiduciary violations related to ING's management of the TU-PF fund.
       Mr Maris, who was also personally fined 231,750 baht, said he wanted to clarify events openly.
       "I have received many questions. I want to clarify the situation for unitholders, both regarding my own actions,as well as the fund itself," he said.
       Mr Maris acknowledged that the case would make him more "cautious" in the future, as well as more meticulous in detailing what actions must receive regulatory or investor approval to avoid potential conflicts.
       "In the past, we see that the alleged wrongdoing that supposedly occurred really is a matter for interpretation," he said.
       The TU-PF fund was launched in 2006 to invest in dormitories and serviced apartments to be built on land owned by Thammasat University's Rangsit campus. The fund would lease the property from Thammasat for 30 years after construction of the facilities was complete.
       The SEC faulted Mr Maris and ING for authorising payments to the lessor and building contractor without seeking approval from unitholders, as well as for approving payments to the contractor prior to the registration of the lease or completion of the buildings.
       Mr Maris said the serviced apartments and dormitory were expected to be completed in November.
       He added that for ING, future property funds would be established only for fully completed projects, rather than launched as pre-financing for construction.
       For the TU-PF Fund, Mr Maris insisted that the basic investment remained sound, as demand for living quarters at the Thammasat campus would increase steadily.
       Rents in the area now stand at 10,000 baht per unit, compared with projections of 7,500 baht when the fund was established. ING estimates that the TU-PF fund should generate annual returns of upwards of 12% over the 30-year lease.
       The fund's lease area covers more than 12 rai near the Thammasat Rangsit campus and includes a 12-storey serviced apartment building, parking facilities and three 10-storey dormitory buildings already opened for use. The area also includes a "lifestyle shopping centre"with 15,000 square metres of retail space and parking for more than 400 vehicles.
       Nitima Kiatwateeratana, managing director of CIEN Co, the marketing manager of the shopping complex, projected occupancy of 60% by 2010, with 10%growth per year afterwards.
       Rental rates at the shopping centre range from 400 to 600 baht per square metre per month, with rates projected to rise by 5% per year.
       TU-PF units last traded on the SET on Aug 25, when they closed at 9.40 baht.