EUROPE - Protego has become the latest real estate investment house forced to suspend redemptions last week, placing a one-year moratorium on investors pulling out of its UK property fund.

"It's quite simple and quite common," said Protego Real Estate Investors CEO Iain Reid.

"It's the responsibility of the board to look after investors who remain in the fund, as well as those wanting to get out. If the numbers are greater than it can handle, it can scale back and pay out or impose a suspension on redemptions without prejudicing the interests of shareholders by reaching a forced sale situation."

He said the fund the sale of an unidentified property was in process, although "we can't guarantee the proceeds will come in this year. The transaction's fine - and we can sell at a reasonable figure. That isn't always the case."

In an interview with IPE Real Estate, Reid took a sweep at recent UK national media coverage as he claimed it has created panic investors redemptions, based on "absolute rubbish".

"The important thing to remember is that funds are a proxy for direct investment. They aren't liquid - and properly advised investors will understand that," he said.

In the meantime, Jones Lang Lasalle's UK capital markets head Julian Stocks claimed - much-mooted - distress among institutional funds was not out of the question.

"There aren't many signs of distress yet, although that might change if outflows from retail funds create a lack of liquidity.  Even so, banks are unlikely to foreclose and institutional funds are unlikely to be hit," he said.

 "Will it be a significant proportion of the market? No. But we are seeing a lot of sitting and waiting," Stocks added.