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Threadneedle UK Property Fund

Heather Ferguson | Fri 23 September 2016

Investments can go down as well as up so there is always a danger that you could get back less than you invest. Nothing here is personalised advice, if unsure you should seek advice.
Threadneedle has lifted the suspension on its UK Property Fund to allow clients to trade with effect from 12 noon on 26 September 2016.

Trading in the fund was suspended on 6 July 2016 as the managers received a large number of requests from investors to sell their investment. Property funds hold a cash buffer to satisfy sales, which is usually sufficient to ensure the managers are not forced to sell properties. However, the increase in requests after the EU referendum was such that the cash buffer was reduced to a level the managers were not happy with.

Threadneedle therefore temporarily stopped investors selling (or buying) units in the fund to afford the managers time to find suitable buyers for some of their properties. If forced to sell quickly they could be required to accept less than fair value to the detriment of remaining investors.

Since July, the managers have completed, exchanged or agreed to sell 25 properties totalling £167m. Cash is now at a level the managers feel is sufficient to meet normal redemption requests. While the managers hope to keep the fund open, any significant increase in requests from investors to sell their holding could cause the fund to re-close.

Instructions to buy or sell units in the fund can be placed online or via the phone. If you wish to place a deal online in time for the first valuation point your instruction needs to be received before 8am on Monday 26 September. Any regular savings contributions accumulated since the fund closed will not automatically be invested. To invest any accumulated regular savings contributions or to restart regular savings into this fund, please log into your account and place an instruction online.

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Managers’ outlook

Don Jordison and Gerry Frewin, the fund’s managers, feel the reaction to the UK’s decision to leave the European Union was irrational. On reflection, investors have realised any effect of the Brexit vote on the UK’s property market will take years to transpire. The current UK property market yield of 5% is attractive against a background of low interest rates and bond yields, and is an attractive alternative to equities, in the managers’ view.

Our view

Our latest views on the property sector are available here.

Find out more about this fund including how to invest

Please read the key features/key investor information document in addition to the information above.

Important information - Please remember the value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. This article is provided to help you make your own investment decisions, it is not advice. If you are unsure of the suitability of an investment for your circumstances please seek advice. No news or research item is a personal recommendation to deal.


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