Five property funds change their pricing

Aberdeen, Henderson, M&G, Standard Life and Threadneedle have all moved their commercial property funds to 'bid' pricing due to a large number of outflows from the sector as a whole. This means that if an investor now wants to redeem their holdings, they will effectively be charged more for doing so. However, the change to bid price does mean a lower entry price for new investors in the funds.

Henderson said in a statement: “It is important to note that the pricing basis decision for a dual-priced UK commercial property fund is not related to the liquidity position of the fund. It is about being fair both to transacting clients and to clients who remain invested in the fund.”

The company said the portfolio, run by Ainslie McLennan and Marcus Langlands Pearse, has “significant diversity” in terms of both its investor base and its property holdings, as well as “material” allocations to cash and property equity assets.

Darius McDermott, managing director of Chelsea, commented: “We expect these funds to remain on bid pricing for the medium term. It is important to remember that existing investors will only face these higher charges if they choose to redeem their holdings. Long-term investors are likely to see the prices move back to 'offer' before they sell their holdings.

“The Henderson fund in particular is a strong performer and commercial property provides diversification in a balanced portfolio. The fund will remain within the Chelsea Income EasyISA and Chelsea Core Selection.”