Aberdeen Asset Management has reduced the fair value adjustment on its property fund, as it revises its outlook for UK property prices.
Aberdeen has cut the price adjustment on the UK Property fund and its feeder fund to -5 per cent, from -7 per cent.
“This reflects our revised assessment of the impact of the vote to leave the EU on property values in the fund. This revision takes into account the latest emerging evidence from independent valuers, evidence of transactions in the market and other relevant inputs,” a statement from the firm says.
Martin Gilbert, chief executive of Aberdeen Asset Management, says that some “calm and order” are being restored in the market.
“The impact of the vote to leave the EU is being felt most in the central London office market, which the portfolio has little exposure to, whereas the retail and logistics markets are holding up relatively well along with longer-leased properties and those less dependent upon future rental growth.
“The quality of our holdings has allowed us to re-assess the fair value adjustment we are applying in the light of further emerging evidence. Of course the situation remains very fragile so we will remain watchful and act accordingly in the interests of all our underlying investors.”
Aberdeen says it will continue to review pricing regularly, depending on market outlooks.
Aberdeen saw £1.5bn of net outflows from its property strategies in the three months to the end of June, which captures a small portion of post-Brexit outflows.