Ground Rents Income Fund may write down values in wake of scandal 

The listed Ground Rents Income Fund has said it may write down the value of some of its assets after the recent furore surrounding the doubling of ground rents on leasehold houses. The £143m fund said it had no assets with ground rents that double perpetually every 10 years. However, it does have some ground rents that double on other time frames. It said in a stock market statement that its board was considering asset management options for certain ground rents within the portfolio in response to the concerns raised by government. It said that as a result of market sentiment the value of the doubling assets within the portfolio may now be worth approximately £5.5 to £6m less than as at 31 March 2017. It said that 17% of its total income was attributed to doubling ground rents, with 4% derived from three 10-year doubling assets. It said these assets did not double in perpetuity – only a maximum of three times. It also said that 15% of the units in its portfolio were houses, which generated 11% of its income. While none is on a 10-year doubling review pattern, 2.7% of the income is on a doubling review on a 25-year review pattern. James Agar, investment director of Brooks Macdonald Funds, alternative investment fund manager to GRIF, said: “We welcome the government’s consultation, which will lead to clarity on leasehold and ground rent structures. We will in due course submit our own response to the consultation, which will be available to view on our website. “We are committed to being a socially responsible landlord, working hard to treat all leaseholders in a simple, honest and transparent manner.” To send feedback, e-mail alex.peace@egi.co.uk or tweet @egalexpeace or @estatesgazette