BlackRock and Schroders Suspend UK Real Estate Funds

By Julie Steinberg

BlackRock Inc. and Schroders PLC are among the latest additions to the list of asset managers that have suspended their U.K. real estate funds.

BlackRock said that due to the difficulties for outside firms to value assets within the portfolio, it suspended trading in its 3.4 billion-pound ($4.21 billion) U.K. property fund as of March 20.

Schroders PLC said it was suspending its GBP2.4 billion U.K. real estate fund as of March 18 for the same reason.

Aviva Investors, Janus Henderson Investors and Kames Capital have made similar moves in recent weeks, for which the funds blamed turbulent market conditions and uncertainty.

Before the spread of the coronavirus, property funds were caught up in Britain's exit from the European Union. Fund management giant M&G PLC in December blocked investors from trading in its property fund. That suspension was related to liquidity issues, however. The fund remains suspended, though the company has said it is making progress in raising cash.

Several U.K. property funds also suspended redemptions in the immediate aftermath of the Brexit vote in 2016. The suspensions showed the dangers of funds that offer daily buying and selling of shares backed by hard-to-sell assets.

Write to Julie Steinberg at [e-mail]

(END) Dow Jones Newswires

April 02, 2020 12:32 ET (16:32 GMT)

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