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Property groups warn Ucis clampdown could hit investment

Property groups warn Ucis clampdown could hit investment

Property companies have raised fears the Financial Services Authority’s clampdown on unregulated collective investment schemes (Ucis) could hurt investment in property stocks, according to The Times.

Property groups Hammerson and Land Securities, which are both structured as real estate investment trusts (Reits), have warned the FSA’s plans could hurt investment into the vehicles.

The FSA is consulting on plans to ban the promotion of Ucis and similar products to ordinary retail investments, and property groups have voiced concerns they will be caught by the clampdown.

A spokesman for the FSA told The Times: ‘Some Reits may be included depending on their legal structure and if they are set up as a special purpose vehicle which is designed for investment purposes. But this is a consultation and this is not a foregone conclusion.’

Hammerson chief financial officer Timon Drakesmith told the paper: ‘Reits are arguably the safest form of securitised real estate as they are mandated to distribute dividends and there is a high degree of scrutiny and oversight. It is perfect for the retail investor and much safer than other types of investable stocks that are apparently fine.’

A spokesman for Land Securities added: ‘The worry about this is that it would almost seem to defeat the purpose why Reits were introduced in the first place, which was to make property investment more attractive to everyone.’

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