People

Her steady hands protect investors' nest eggs

Ms Jill Smith says being a kindergarten teacher is not all that different from having investors' nest eggs in her charge. In her 35-year career, she has guided investors through a fair number of market crashes.
Ms Jill Smith says being a kindergarten teacher is not all that different from having investors' nest eggs in her charge. In her 35-year career, she has guided investors through a fair number of market crashes.ST PHOTO: ALPHONSUS CHERN

Manulife US Reit manager's CEO credits her sense of responsibility to teaching experience

Before joining the world of finance, Ms Jill Smith pursued an interest in early childhood education - a calling that proved surprisingly useful in her eventual career choice.

Ms Smith, now the chief executive of the manager of Manulife US Reit, says being a kindergarten teacher is not all that different from having thousands of investors' nest eggs placed in her charge.

"It's a huge responsibility, and that's something I try to bring to any organisation that I work for," says Ms Smith, a Briton who has lived in Singapore for more than 20 years.

She graduated from Durham University with a degree in sociology, did a postgraduate certificate in education, and describes her career in finance as a "happy accident".

Her teaching stint took her to a coal-mining town in England's north-east, where she taught four-and five-year-olds.

Ms Smith, 63, recalls: "I just adore children at that age because they're so accepting. You've got all types and they're at a very formative stage. You're really laying down their foundation and that's a big responsibility.

"I consider myself to be a very responsible individual. I think that governance is extremely important, I always have done, and we (Manulife US Reit) are trying very, very hard to make sure we're as perfect as we can possibly be in that respect. You have a responsibility to all your investors."

ACCOUNTABLE TO INVESTORS

I consider myself to be a very responsible individual. I think that governance is extremely important, I always have done, and we (Manulife US Reit) are trying very, very hard to make sure we're as perfect as we can possibly be in that respect. You have a responsibility to all your investors.

MS JILL SMITH, on her strong sense of responsibility, which stems from her career beginnings as a kindergarten teacher.

In her 35-year career managing money for various funds across Asia and Europe, Ms Smith has guided investors through a fair number of market crashes and earned a reputation as a safe and steady pair of hands.

As a fund manager, she remembers facing a 100-strong crowd of retail investors in Penzance on England's south coast in 1987 to talk about Asian investments. It was Black Monday and the markets "had just absolutely plummeted".

Ms Smith says: "I can remember sitting in the train all the way down thinking, what the heck am I going to say to these people? This is their pension, this is their nest egg. We have a responsibility. And I just said, 'Look, this is a terrible time'."

She stayed focused, stood calm and decided to share a family story.

"My grandfather came from a very rich family, a cotton-owning family. And my grandfather lost all his money in the Great Crash of 1932, for all sorts of reasons but primarily because his portfolio was not diversified enough," says Ms Smith, who is a single mother of a 24-year-old son.

"But my great-grandfather was much more savvy. He'd organised his finances so well that in the bad times, he didn't have to sell. He kept his money invested. He did not try to trade in and out and try to game it. He stayed in.

"So I was trying to say to those investors - one, diversify. Don't have too narrow a portfolio. But when you're in there, stick to it. Don't try and churn. Choose carefully to begin with, and stick with it. Choose wisely, look at the fundamentals, look at the track record, look at the industry."

Ms Smith adds: "It's the same if you're looking at a building. You're looking at a number of different aspects."

In September, Manulife US Reit did a rights issue to partially fund the acquisition of an office property at 10, Exchange Place, in New Jersey, its second and largest buy since the Reit was listed here in May last year.

The mid-cap Reit reported a distribution per unit of 1.60 US cents in the third quarter, beating its projection by 9.6 per cent while net property income was US$14.4 million (S$19.7 million), 20.9 per cent above its forecast.

Ms Smith is liking the journey so far, which she describes as a kind of balancing act.

For investors, the purpose a Reit has in their portfolio is to provide a good stream of income.

"So they're very useful for pension funds and nest eggs, but at the same time, investors want those Reits to grow," Ms Smith explains.

"There are only certain ways of growing - either through equity or debt - so you will be coming back to the market. You'll be saying to your investor: 'Thank you for your money, here's your income, but now I'd like you to put more in because we want to grow'."

The only way a Reit manager can keep going back, she says, is if it proves itself by building a good track record. Manulife US Reit has received a very good response to its rights issue and two acquisitions, she adds.

So how fast does the Reit intend to grow?

Ms Smith says: "There's no specific target. We just know we want to grow and we want to grow in the right way... Your investors want that growth and they want you to diversify that portfolio to strengthen it further, but at the same time you have to be mindful of how fast you grow."

It has been 24 years since Ms Smith first came to Singapore, and she feels like she has travelled with the country's financial story.

In 1994, at the 10th anniversary dinner of the Singapore International Monetary Exchange, she witnessed then Senior Minister Lee Kuan Yew make a speech.

"He said, we are going to make Singapore into a financial hub. And that just unleashed the forces in terms of the fund management industry... That was the real start and it was so exciting to be here at that point," she recalls.

For her, the journey of Manulife US Reit is like a smaller scale version of Singapore's. Manulife has been investing in and managing real estate for more than 80 years.

"You've got the massive Manulife listed company, and we're this teeny-weeny Reit to help Manulife's brand. If Singapore is the little red dot to the world, we're the little green dot to Manulife."

A version of this article appeared in the print edition of The Straits Times on November 13, 2017, with the headline 'Her steady hands protect investors' nest eggs'. Print Edition | Subscribe