We're continuing to monitor property funds in terms of potential suspensions and will update this page accordingly.
We've received notice that on 16 March 2020 the Kames Capital plc Board has decided, with agreement from the Depositary, to temporarily suspend dealing in the following funds:
Kames Property Income Fund
Kames Property Income Feeder funds (Accumulation and Income)
Kames Property Income Fund and Feeder Funds update - 16 March 2020
Following the temporary suspension of the M&G Property Portfolio and M&G Feeder of Property Portfolio funds on 4 December 2019, M&G has prepared this FAQ to provide more detail.
On 18 March 2020, Columbia Threadneedle Investments has temporarily suspended dealing in the Threadneedle UK Property Authorised Investment Fund and the Threadneedle UK Property Authorised Trust.
Check out their website for more details and regular updates on the fund suspensions.
On 18 March 2020, L&G suspended trading in the Legal & General UK Property Fund and Legal & General UK Property Feeder Fund. Check out their update below.
On 18 March 2020, Aberdeen Standard Investments suspended dealing in the following funds:
Aberdeen UK Property Fund, Standard Life investments UK Real Estate and ASI Life UK Property Fund.
Check out their updates below.
ASI Life UK Property Fund update - 18 March 2020
All PAIFs and Feeders suspension - 18 March 2020
ASI Global Real Estate Fund - 18 March 2020
On 18 March 2020, Aviva temporarily suspended dealing in the following funds:
The Aviva Investors UK Property Fund, the Aviva Investors UK Property Feeder Inc Fund and the Aviva Investors UK Property Feeder Acc Fund.
Check out their update:
The Aviva Investors UK Property Funds update - 18 March 2020
We've received notice that on 18 March 2020, Time investments has suspended dealing in the following three funds:
ARC TIME Commercial Long Income PAIF,
ARC TIME Social Long Income PAIF and
TIME Freehold Income Authorised Fund.
Check out their website for more information and FAQs on the fund suspensions.
We received notice on 17 March 2020 that Janus Henderson Investors are suspending dealing in their UK Property PAIF and Feeder funds.
Check out their notice below.
Janus Henderson UK Property PAIF and Feeder Fund update - 17 March 2020
On 17 March, Margetts Fund Management Ltd temporarily suspended dealing in the MGTS St Johns Property Fund and MGTS St Johns Authorised Property Trust.
Check out their update below:
MGTS St Johns Property fund and Authorised Property Trust - 17 March 2020
Property fund suspensions FAQ
Frequently asked questions
By the close of play on 18 March, the following funds had been suspended. We expect more to follow and will provide regular updates here.
Effective date of suspension
Aberdeen UK Property Fund
Standard Life investments UK Real Estate
ARC TIME Commercial Long Income PAIF
ARC TIME Social Long Income PAIF
TIME Freehold Income Authorised Fund
Aviva Investors UK Property Fund
BMO UK Property Fund
BMO Property Growth & Income Fund
Janus Henderson UK Property Authorised Investment Fund
Kames Property Income fund and feeder funds
Legal & General UK Property fund and its feeder fund
M&G Property Portfolio
Threadneedle UK Property Authorised Investment Fund
Threadneedle UK Property Authorised Trust
The suspensions are effective from the previous valuation point to the effective date listed for each fund above. The decisions to suspend the funds have been attributed to the Coronavirus (Covid-19) situation and the ongoing Brexit talks. Details of each fund suspension can be found here.
The length of the suspensions haven’t been confirmed, only that the positions will be reviewed on a regular basis. We’ll provide any updates received from the investment managers here.
Property funds by their very nature are comparatively illiquid as they invest in properties. The investment manager will retain a percentage of the fund in cash to maintain a degree of liquidity, however, where there is an increase in outflows the liquidity will reduce as the cash is used up.
In periods of uncertainty, a fund manager can opt to initiate a ‘fair value’ adjustment to their fund if they decide that market conditions are likely to have changed the underlying value of the fund as a result of the market uncertainty. In this situation, a fair value is assessed by the fund manager as being a better representation of the value of the underlying assets until an independent assessment of the impact of the market conditions on the properties values can be assessed. In these situations, we will notify you of any move to fair value pricing on the platform noticeboard.
No. All trades have been suspended including regular investments. If your client has one of the affected funds within a regular contribution, the instruction into that fund will not be sent and will remain in cash. Any other assets in a regular contribution will be instructed as normal. For regular investments into pensions the tax relief portion will follow the same investment pattern as the regular contribution.
Different investment managers are taking different approaches with some not accepting any dealing instructions and others accepting instructions but ‘queuing’ them. Based on conversations with each manager they have all given assurances that they will give adequate notice of the fund re-opening to allow new dealing instructions to be placed in reasonable time. They all recognise their responsibilities under the COLL rulebook and their duty to treat customers fairly in this respect. Queued orders will not therefore get any special treatment or early price, all orders taken when the fund re-opens will be priced the same. It is simpler therefore not to send any instructions at this stage than take different approaches for different managers.
Yes. The funds will still have a value and be priced accordingly throughout.
Yes, the funds will continue to operate as normal in all other respects and income payments will continue to be paid.
The investment managers have taken different positions on this. In some cases if the investor has chosen to re-invest any growth then this will be paid in cash, rather than re-invested.
In other cases accumulation units will continue to operate as normal. Where income is being taken and the cash reinvested then no. No further cash is being accepted into the funds.
Please check the specific investment manager information here.
Any non-settled trades will be rejected if they are received any time after the valuation point previous to the effective date. So if a fund has a midday VP and suspended on 18/3, any dealing instructions received after midday on 17/3/20 will be rejected.
In this situation the cash received will be allocated to assets selected within the new business application as normal with the exception of the suspended asset in which case the investment will remain in cash.
This is dependent on the funds reopening. When this happens an individual’s investment value will depend on the share price of the portfolio’s underlying holdings. Where the price of those assets has risen, the value will be higher than it was at the point of suspension. Where the price of those assets has fallen, the value will be lower than it was at the start of the suspension.
We’re checking with investment managers on the their approach in these situations and will provide details as soon as possible.
The suspension of these funds will impact rebalancing within model portfolios and we recommend removing any affected fund from a model, otherwise there will be an impact on other trades. A rebalance will continue to fail until the suspended fund is removed from the model portfolio or the fund suspension is lifted. We’ll continue to monitor and provide updates, but it’s important that when the fund suspensions end the fund is returned to the model before the next rebalance, as any subsequent rebalance will sell 100% of this fund due it not being in the model.
Yes. The fund has been excluded from auto-disinvest which means no instruction will be generated to sell down the suspended asset. In this case, the auto-disinvest will proportionately sell down across the remaining assets in the instruction to achieve the required income amount unless or until there are no other assets to sell.
No. All assets other than the suspended asset will be sold as directed unless an additional or amended instruction is received.
Certain investment managers have indicated a willingness to review these type of exceptional circumstance cases but not all. Each case will, therefore, be treated on best endeavours, case by case basis with each fund manager.
In this situation, this fund will be excluded from the sell down before allocating assets.
If you’re a client, please speak to your adviser or contact us at email@example.com.
For advisers, please contact your regional account manager.