LONDON (Reuters) – UK property funds which resumed operations after a six-month freeze recorded net outflows of Â£ 336million in October, the third worst monthly performance on record for the sector, the network said on Tuesday. Calastone fund.
Much of Britain’s Â£ 70 billion real estate fund industry was put on hold in March after experts said it was not possible to be sure of valuations due to the COVID-19 pandemic.
Several asset managers, including Columbia Threadneedle, St James’s Place SJP.L, Legal & General LGEN.L and BlackRock BLACK.N, have reopened their funds in recent weeks, as valuation uncertainty eased in September.
“Now that so many real estate funds have reopened for businesses, big buyouts are just a shake-out, investors who want to get out of real estate assets finally have the opportunity to get their capital back,” said Edward Glyn, head of real estate. world markets in Calastone.
Calastone said the industry has only seen monthly outings on two separate occasions – December 2019 and December 2018.
The value of sell orders was eight times the value of buy orders in October, he said.
The previous low for buy orders was in July 2016, a month after Britain voted to leave the European Union, when sell orders outnumbered buy orders by five times.
âFurther buybacks are likely until the pent-up appetite to sell is sated,â Glyn said.
Calastone did not name any of the real estate funds he was tracking. More than two-thirds of UK domiciled funds flows by value pass through its network each month.
Columbia Threadneedle, which reopened its fund in mid-September, said it recorded Â£ 74million in net outflows in September. The Threadneedle UK Property Authorized Investment Fund has Â£ 940million in assets under management, according to Morningstar.
Reporting by Carolyn Cohn; edited by Sinead Cruise