UK - First Property is to target small and medium-sized pension funds in the UK with a fund modelled on its earlier UK Pension Property Portfolio vehicle.

Fprop Sterling Income Fund (FSIF) will follow a similar strategy to its now fully invested predecessor, an ungeared vehicle set up in 2010 for three pension funds, which focused on long-lease assets and generated an average annual yield of 6.4%.

The new fund will have a target size of £100-300m (€120-354m).

Ben Habib, chief executive at First Property, said: "The fund parameters would suit investors looking for secure, sustainable revenues of 6% after costs. It's not an opportunistic-type return."

The launch of the second domestic fund is a confirmation of First Property's confidence in the UK market, following its exit near the top of the market to focus on investment in Polish real estate.

"We're bearish on the UK economy but there are pockets where yields are achievable," said Habib.

Speaking from Poland today, he said:  "We aren't moving back to the UK at the expense of Poland. There are a lot of things we plan to do in Poland. The economy is stronger, and yields are higher than in other markets."

However, Habib ruled out the launch of a Polish property fund - at least in the short term. "UK institutions at the moment are probably not in a mindset to invest in Poland," he said.

"We're in a risk-off environment. Continuing volatility in the euro-zone is putting pension fund trustees and advisers on the back foot, and investors would see Polish real estate as a riskier investment [than the UK]. We don't - we think it's a safe proposition - but in times of uncertainty, money goes back home."