Pooled property funds (PPFs) in the UK continued to leak money in 2008 but the rate of redemptions appeared to slow in the final three months, according to the Association of Real Estate Funds (AREF). The association's ninth Investment Quarterly report show the PPF sector experienced a net outflow of £500 mln (about EUR 553 mln) during 2008, compared to a net inflow of £200 mln the previous year.
Pooled property funds (PPFs) in the UK continued to leak money in 2008 but the rate of redemptions appeared to slow in the final three months, according to the Association of Real Estate Funds (AREF). The association's ninth Investment Quarterly report show the PPF sector experienced a net outflow of £500 mln (about EUR 553 mln) during 2008, compared to a net inflow of £200 mln the previous year.
While Scottish Widows and several other UK fund managers have been forced this year to delay repayment to investors withdrawing their money from property funds, the overall pace of redemptions slowed in the fourth quarter of 2008.
AREF’s report indicates that £791 mln was withdrawn in the fourth quarter, significantly down from the same period the year before. The sector also raised £567 mln in new money in the fourth quarter of 2008, over double the amount raised in the previous quarter and 33% more than in the fourth quarter of 2007.
In net terms, there was a net outflow of £200 mln in the fourth quarter of 2008.
AREF said Pooled Property Funds total returns were -18.7% quarter-on-quarter in the fourth quarter of 2008. Real estate equities returned -34.3% during the same period.
