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Reporting Standards Council Meeting: Global Standards Initiatives and Reporting Standards 2020November 19, 2019ADDITIONAL RESOURCES: REPORTINGSTANDARDS.INFO
FOLLOW THE REPORTING STANDARDS ON LINKEDIN
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AgendaTopic Presenter(s)
Welcome and introductions John CarusoCouncil Chair
Global initiative panel discussion with Global Standards Steering Committee members
Moderator: John Caruso, Co-Chair Global SSC, Chair Reporting Standards CouncilPanelists:Barbara Flusk, Mike Morrell, Connie Tirondola, Candice Todd
Review of 2019 Sally Ann FloodCouncil immediate past Chair
Ask the Council: 2020 Reporting Standards changes and enhancements
David DiPaolo, Sally Ann Flood, Barbara Flusk and John Kjelstrom
What’s next for Reporting Standards? John Caruso
Closing John Caruso
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APP Instructions for Live Polling & Live Q&A
•Click Agenda icon
•Find this session: Reporting Standards 2020 & Global Standards Initiatives
•Scroll to Live Polls at the bottom
•Submit a question you’d like the Council to answer under Live Q&A!
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Welcome and IntroductionsJOHN CARUSO, REPORTING STANDARDS COUNCIL CHAIR
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John Caruso – Chair
•John Caruso is Managing Director, Head of Finance – Americas for Nuveen Real Estate which consists of approximately $90 billion in real estate equity and debt assets under management in North and South America.
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New Reporting Standards Logo!
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Council MembersNEW MEMBERS AND EXTENSIONS
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New Members
Partner, PwC
Lou DeFalco
Senior Vice President,
Institutional Marketing &
Investor Relations, Equus Capital
Partners
Joseph Nahas
Head of North American
Investment Performance,
LaSalle Investment Management
Diane Wild
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Term Extensions
Head of Real
Assets, Citco
Barbara Flusk
Director, Chatham Financial
John Kjelstrom
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Council Members as of November 2019
John Caruso, Managing Director, Head of Finance –
Americas, Nuveen Real Estate
Chair
Peter Bloomfield, Audit Partner, KPMG
Sarah Cachat, Partner, Townsend Group, an Aon
Company
Sara Davis, Senior Vice President,
Blackstone
Lou DeFalco, Partner, PwC
Jane Delfendahl, Investment Director,
CalPERS
David DiPaolo, Senior Vice President,
Clarion Partners
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Council Members
Barbara Flusk, Head of Real Assets, Citco
Kathryn Gernert, Senior Portfolio Manager, Texas
Education Agency
Barry Johnson, Senior Vice President, Global
Head of Real Assets, State Street Global Services
John Kjelstrom, Director, Chatham Financial
Joseph Nahas, Senior Vice President, Institutional
Marketing & Investor Relations, Equus Capital Partners
Diane Wild, Head of North American Investment Performance, LaSalle
Investment Management
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Board Members
Jim Allen, Managing Director & Fund CFO, Starwood
Capital Group
as of January 2020
Neal Armstrong, Director, Alternative Investment Services, BNY Mellon
Michael Fogliano, Senior Portfolio Manager, Real
Estate, State Board Administration of Florida
Mike Morrell, Manager, Global Real Estate
Investments & Commercial Lending, NYSTRS
Jerry Silvey, Vice Chairman & CFO, Starwood Capital Group
Retiring as of December 2019
Allison Yager, Partner, Global Leader Real Estate, Mercer
Nathan Zinn, Senior Managing Director, CBRE
Global Investors
Term expires December 2019
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Cristiano Machado, CFO Real Estate Funds, Brookfield
Property Group
Chair
Paul Quinlan, Managing Director & CFO, Real Estate,
Blackstone
Vice Chair
“It’s a big world out there. It would be a shame not to experience it” – J. D. Andrews
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Global Standards Initiatives Panel
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John Caruso
Moderator
Barbara Flusk
Mike Morrell
Connie Tirondola
Candice Todd
Global Standards Initiatives Panel
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John Caruso
Moderator
Barbara Flusk
Mike Morrell
Connie Tirondola
Candice Todd
Global Standards Initiatives Panel
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John Caruso
Moderator
Barbara Flusk
Mike Morrell
Connie Tirondola
Candice Todd
Review of 2019
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Sally Ann Flood
MISSION
To establish, manage and promote transparent and consistent reporting
standards for the Real Estate Industry to facilitate informed investment decision-
making.
ESTABLISH STANDARDS• Develop reporting standards
that are relevant to both open-end and closed-end funds that can improve the investment decision-making of investors.
GLOBAL ALIGNMENT• Converge investor reporting
standards globally.• Build a global platform for
transparent and consistent reporting for international investors and advisors.
Collaborate
Compliance
Promotion
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RS 2020: Strategic plan is catalyst for RS evolution1
•Establish Reporting Standards relevant to both open-end and closed-end funds, facilitating decision making:
◦ TWR: maintained open-end reporting requirement and provide for consistent and comparable TWR reporting for closed-end funds when requested.
◦ IRR: provided additional transparency in gross and net IRR reporting.
◦ Valuation: enhanced internal requirements while acknowledging fund structure differences may impact external appraisal considerations.
•Global Alignment◦ Total Global Expense Ratio (TGER): developed first globally comparable measure of fee and
expense load.
◦ Global Definitions Database (GDD): referenced GDD as source for definitions in RS materials.
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What’s new in RS 2020
David DiPaolo
Sally Ann Flood
Barbara Flusk
John Kjelstrom
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What’s new in RS 2020?TWR : comparable and consistent TWR reporting available to closed-end funds as requested
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Element description Frequency
Required or
recommended
element
Applicable
account type
Total and Component Time-Weighted Return
(TWR) - Gross and Net of Fees
Quarterly Required Open-end
Total and Component Time-Weighted Return
(TWR) - Gross and Net of Fees
As requested by investor Closed-end
Total and Component Time-Weighted Return
(TWR) - Gross and Net of Fees
Quarterly Recommended Single-client
Disclosures accompanying TWR: Required when TWR is reported All
Gross of fees
Net of fees
Period
Calculation Methodology
Valuation and accounting policy and fees
Treatment of activity before initial contribution
Start and end dates
What’s new in RS 2020?Gross and net IRR includes enhanced disclosures
Element description Frequency
Required or
recommended
element
Applicable
account type
Since Inception Internal Rate of Return
(IRR) - Gross and Net of fees
Quarterly Required Closed-end
Since Inception Internal Rate of Return
(IRR) - Gross and Net of fees
Quarterly Recommended Single Client
Disclosures accompanying IRR: Required when IRR is reported All
Gross of feesNet of feesTime period and frequency of cash flowsRealized IRR end dateUse of subscription lines
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What’s new in RS 2020?TGER, our first global standard
Element description FrequencyRequired or recommended
element
Applicable
account typeTotal Global Expense Ratio (TGER) Annually Required Open-end
Total Global Expense Ratio (TGER) Annually Required for funds
launched in 2020 and
beyond
Closed-end
Disclosures accompanying TGER: Required when TGER is reported
Use of rebatesTypes of fees and costs included in
calculationUse of estimatesFees paid in lieu of third party services
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What’s new in RS 2020?Valuation changes impact internal and external valuation frequencies, policies and procedures
Element description Frequency
Required or
recommended
element
Applicable
account type
Valuation policy Required All
Internal Valuations Quarterly Required All
External Valuations Annually Required Open-end
External Valuations As provided in agreements Closed-end
External Valuations
Once every three years
minimum Recommended SMA
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“Insufficient facts always invite danger.”
— Spock (Leonard Nimoy), Star Trek, Season 1: This Side of Paradise
What’s next: Aggressive outreach and investor reporting
•Success of RS 2020: multi faceted outreach
• Investor (specific reporting): logical next step
•Fund Governance
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Many thanks…
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US Real Estate Funds Leader, Deloitte &
Touche
Sally Ann Flood
Principal, Head of US Research,
BentallGreenOak
Paul Briggs
Managing Director and Fund Chief Financial
Officer, Starwood Capital Group
RS Board Member effective January 1,
2020
Jim Allen
Visit the Reporting Standards
Online: www.reportingstandards.infoLinkedIn: https://www.linkedin.com/company/ncreif-prea-reporting-standards
Email: [email protected]
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