SLI UK Property converts into Paif

Standard Life Investments has converted its £471m UK Property fund into a property authorised investment fund after the plan was backed by investors earlier this month.

Following unanimous support from unitholders at an EGM, the fund has been changed from an authorised unit trust to an open ended investment company with a tax efficient Paif structure.

Using this structure will enable tax exempt investors to receive income from the fund gross of the 20 per cent corporation tax previously applied to income.

There will be no change to the fund’s name, investment strategy, risk profile and objective and Nigel Chapman will continue to manage the portfolio.

SLI head of wholesale and listed real estate Andrew Jackson says the fund’s estimated distribution yield will increase from 3.61 per cent to 4.52 per cent for qualifying investors because of the change.

“Investors are attracted to commercial real estate because of the income yield it offers,” he adds.

“Getting more of that income back into the hands of eligible investors without altering the risk profile of the fund can only be a good thing.”