Aberdeen lifts property fund suspension

Property-Building-Growth-House-Housing-700x450.jpgAberdeen Asset Management has lifted the temporary suspension on its property fund, after a week.

The asset manager imposed a gate on the Aberdeen UK Property Fund and its feeder funds a week ago, after putting a 17 per cent charge on those leaving the fund.

Martin Gilbert, chief executive of Aberdeen Asset Management, says: “Following the lifting of the week-long suspension, I am pleased that investors will now be able to trade shares in the funds.

“Investors should be aware that the price may be adjusted on a daily basis to reflect the funds’ requirement to provide liquidity and the need to protect all investors. The market may take time to find its level but I have no doubt that property will continue to play an important part in investors’ portfolios.”

The suspension allowed investors who had already requested trades the ability to exit that request, in light of the 17 per cent charge on the fund.

On Monday Gilbert said the fund would extend its suspension on trading for two more days following requests from two platforms. He added that many trades submitted last week had been withdrawn by investors following the application of the exit penalties.

Investors will now be able to trade on the fund from noon 13th July, with any orders to redeem placed during the suspension period having been rejected.

A statement from the company says: “It is important to note that the anti-dilutive measures we have put in place have been imposed solely to reflect the need to dispose of properties in order to provide liquidity.

“Doing so allows us to protect value for longer-term investors and, although today’s price also incorporates a fair value adjustment of 7 per cent on property holdings, the diluted price is quite distinct from that and not a reflection of what we believe is currently achievable in the absence of undue pressure to sell properties.

“Accordingly, if future trading in the fund reverts to lower levels, we would expect to lower or remove the dilution adjustment, and the price would then revert to a level reflective of longer-term property values.”