Aberdeen Asset Management has reduced the redemption penalty in its UK Property Fund following sales of assets.

The fund manager, which temporarily suspended trading in its open-ended UK real estate fund earlier this month, said it has now reduced the dilution adjustment applied which had effectively created a 17% penalty charge for investors exiting the fund.

Aberdeen said the move, which “has resulted in a 7.5% uplift on the fund’s dealing price”, was made following several disposals of assets owned by the fund.

Less then a week ago, the manager sold one of its largest assets – a 59,000sqft building in London’s West End – for £124m to Norway’s sovereign wealth fund.

Aberdeen said: “The reduction in the dilution adjustment applied is a reflection of the reduced volume of redemptions experienced over the past week and the fact that cash levels of the funds have been rebuilt following the completion of a select number of property disposals.”

Martin Gilbert, CEO of Aberdeen, said: “Our hope is that trading in the funds continues to revert to more normal levels. This should allow us, in time, to remove the dilution adjustment altogether.”

However, Aberdeen could not rule out increasing the dilution adjustment again if redemptions rose and cash levels were depleted.

Gilbert said: “In all of this, our focus has been to treat all customers fairly by providing liquidity to those who wish to redeem whilst protecting the interests of long-term investors.

”The post-referendum environment now seems to be settling down with thoughts of reducing property holdings being balanced by the fundamental long-term attractions of the asset class.”

The 7% fair value adjustment – separate to the dilution adjustment – still applies.