Columbia Threadneedle to reopen property funds on 17 September

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Columbia Threadneedle to reopen property funds on 17 September

Columbia Threadneedle is to lift the temporary dealing suspension on the Threadneedle UK Property Authorised Investment Fund (PAIF) and its feeder fund, the Threadneedle UK Property Authorised Trust, on 17 September.

The reopening follows confirmation from its independent valuer CBRE that it has removed the Material Uncertainty Clause from the assets held by the fund, which it deployed in March during the coronavirus crisis market sell-off.

The £1bn Threadneedle PAIF and its feeder fund, which invest in physical UK commercial property, temporarily suspended dealing on 18 March.

[This represents] one step on the path back to a normally functioning commercial property market."

The announcement comes after the Royal Institution of Chartered Surveyors (RICS) recommended this morning (9 September) a "general lifting" of material valuation uncertainty over the valuation of "all UK real estate", with exception of "some assets valued with reference to trading potential" which saw St James's Place lift the suspension on its range of property funds.

Gerry Frewin, fund manager for the Threadneedle PAIF, said: "We appreciate that suspending dealings in the fund may have caused some inconvenience for our clients, however the decision to suspend dealing meant that no unitholders would be disadvantaged and ensured the fair treatment of all investors at a time of exceptional market uncertainty." 

Paul Richards, managing director of the Association of Real Estate Funds, said that the lifting of the material uncertainty clause was "one step on the path back to a normally functioning commercial property market."

"Fund suspension is not undertaken lightly and is done in the best interest of savers and investors. It is for individual funds to decide when to re-open having considered their investors' needs and their liquidity position," Richards said.

Frewin added: "While short-term property returns turned negative during the first half of 2020 due to Covid-19 and the resulting uncertainty in markets and economies, capital volatility has been easing, and the longer-term case for property remains compelling on an income and portfolio diversification basis."

This article was first published by our sister title Investment Week

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