M&G keeps Property Portfolio fund suspended

M&G Investments will keep its £2.5bn Property Portfolio fund gated, as the markets continue to feel the impact of the coronavirus pandemic. It said that “unsurprisingly, potential buyers, particularly in the retail and leisure sectors, are pausing to reflect on the impact of Covid-19”. However, it added that the fund managers “remain encouraged by the continued purchaser interest – despite delays to contractual agreements”. Since the fund’s last update on 25 February, a £4.9m asset has been sold with a further £39.8m exchanged, bringing the total of assets which have either exchanged or are under offer to £296.8m. The fund’s March month-end valuation, carried out by Knight Frank, will include a statement of material uncertainty caused by the spread of Covid-19. “In the absence of enough transactions on which to base accurate valuations, a higher degree of caution should be attached to all UK property assets than usual,” it stated. Tony Brown, global head of M&G Real Estate (pictured), said: “As anyone who has bought or sold a property will know, a key aspect to an asset sale is an inspection. “In the current climate, however, buyers are either curbing travel plans or are not granted access by tenants, so this part of the process is taking much longer than usual. Our immediate focus is to exchange and complete on all assets that are already well progressed.” M&G will continue to waive 30% of the fund’s annual charge in recognition of the inconvenience caused to its clients and customers. The fund stated: “We thank you for your continued patience and hope everyone is staying as healthy and safe as is possible at this difficult time.” To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette