Aegon Asset Management has revealed that following the onset of the pandemic last year, it has decided to suspend the group’s Property Income Fund and its Feeder Funds.
The decision was attributed to the “material uncertainty” over valuations in the UK property market. Since then, the funds have remained suspended as the group worked to raise liquidity to meet anticipated investor redemption demands.
The firm claimed that it was initially hoped that the suspension would be lifted in Q2 2021. However, it proved to be an increased challenge to raise sufficient liquidity whilst also ensuring that continuing investors have a representative and well-balanced portfolio.
Accordingly, in order to ensure all investors are treated fairly, the company has decided to take steps to close the funds and return the proceeds to investors “as quickly as possible”, in a fair and orderly manner.
Latterly, the economic downturn and government imposed lockdowns have further challenged the sector, as has uncertainty about the long-term future of daily dealt property funds.
The group stated it will continue to raise liquidity and pursue the sale of all properties owned by the Aegon Property Income Fund, adding that property sales can take time and must be done in an orderly manner to ensure fair prices are achieved for all its investors.