Columbia Threadneedle Investments is to become the latest group to re-open its retail property fund, 11 weeks after trading was suspended.
The Threadneedle UK Property Authorised Investment fund (PAIF) was gated on 6 July to stem outflows during the market instability following the Brexit vote. Eight other asset managers also suspended trading in their property funds.
The suspension will be lifted on 26 September at 12 noon without redemption penalties and will return to standard monthly valuations, having switched to weekly valuations during the suspension period.
Columbia Threadneedle joins Aberdeen Asset Management and Canada Life, which both recently re-opened their property funds.
Don Jordison, managing director of property, Columbia Threadneedle Investments, says the firm will “continue to closely monitor conditions to ensure the interests of our investors in the fund are paramount at all times.”
He says: “In the short period following the referendum we saw animal spirits drive unprecedented levels of redemptions from daily dealt open-ended property funds.
“Much of the earlier commentary now appears slightly irrational and more informed reflection has settled the market. Any effects of the Brexit vote on the overall UK economy – negative or otherwise – will take many months if not years to transpire and some time after that for the property market.”
Jordison says that with the UK property market yielding 5 per cent in the current low-growth climate, UK property offers a significant in-built risk premium for long-term investors. The yield on the Threadneedle PAIF is currently 6.6 per cent against proven valuation (as at 31 July 2016), he adds.