M&G blocks withdrawals from one of its major property funds – in a move reminiscent of Neil Woodford
M&G has blocked withdrawals from one of its major property funds
M&G has blocked withdrawals from one of its major property funds – in a move reminiscent of Neil Woodford banning transfers at his own firm last month.
The M&G UK Property Income Fund has blocked investors from removing their cash following a rush for the exits.
Unlike Woodford’s Equity Income fund, which was suspended at the beginning of June after running out of ready cash to repay departing clients, the M&G fund is not aimed at individual investors. Instead, it is held by institutions such as pension funds and insurance firms.
M&G said it needs to sell properties to raise enough money to meet withdrawal demands, and as this can take a long time to complete the fund will be suspended for up to six months.
In a statement, the fund manager said: ‘Occasionally we put withdrawal requests on hold for this type of fund, which enables us to get the best price we can for property we are selling within it.’
Property funds fell into trouble and halted withdrawals after the Brexit referendum, when a flood of investors tried to pull out their money over fears that property prices would tumble.