Columbia Threadneedle and St James’s Place reopen UK property funds


LONDON (Reuters) – Columbia fund managers Threadneedle and St James’s Place SJP.L on Wednesday said they would reopen their suspended UK property funds after UK surveyors said they no longer saw any “material uncertainty” in property valuations, which was a major obstacle to reopening.

FILE PHOTO: A person on a bicycle walks past houses on an early morning street in Islington, London, Britain June 22, 2020. REUTERS / Simon Newman

Real estate funds for retail investors, totaling more than $ 8 billion, were suspended in March after experts said it was not possible to be sure of valuations due to the COVID pandemic. 19. Institutional funds quickly followed suit in the UK real estate fund industry, which is worth £ 70bn ($ 91bn) in total.

The rules governing real estate funds meant they should consider suspending under circumstances where surveyors issued such a warning, the Real Estate Funds Association (AREF) told its members in March.

The Royal Institution of Chartered Surveyors said on Wednesday that its forum on the matter “recommends a general lifting of uncertainty over material valuations”, highlighting the relaxation of many restrictions on households and businesses due to the pandemic.

Surveyors should continue to assign the label of material uncertainty to “certain leisure and hospitality assets” on a case-by-case basis, he added in a statement.

Columbia Threadneedle announced it would reopen its £ 1 billion commercial real estate fund, aimed at retail investors, on September 17, after its CBRE experts said it removed the material uncertainty clause from the fund’s assets.

“Volatility has eased and the long-term case for real estate remains compelling,” said fund manager Gerry Frewin.

Place Saint-Jacques SJP.L said it would reopen three real estate funds with a total of £ 3.2 billion in assets under management as of Thursday.

AREF chief executive Paul Richards said it was up to individual funds to decide when to reopen.

Other funds have been more cautious.

A spokesperson for Aegon Asset Management said its fund will not reopen at least until its next valuation date in late September, and that the company will also review liquidity levels and real estate transaction volumes before making a decision. .

Aberdeen Standard Investments SLA.L also did not expect his funds to reopen by September 30 “at a minimum,” adding that he needed to look at expected cash levels, the real estate market and investor flows.

Janus Henderson JHG.N and M&G MNG.L said their funds remain on hold and will notify investors no later than four weeks.

Aviva AV.L said he was monitoring the situation and Royal London said he had not yet made a decision.

Regulators are unhappy with funds, such as commercial real estate funds, which invest in illiquid assets but allow investors to withdraw their money every day. Many funds were also suspended after the British vote to leave the European Union in 2016.

The Financial Conduct Authority proposed last month that investors in real estate funds wait up to six months before they can get their money back, to avoid a rush to exit leading to widespread suspensions in rocky markets.

($ 1 = 0.7686 pounds)

Reporting by Carolyn Cohn; Editing by Pravin Char and Mark Potter


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