A number of ex-Tilney investment managers, who have already been trapped in the Glanmore Property fund for four years, face at least a further six-month wait to liquidate their holdings.
Managers who formerly worked at Tilney Investment Management, which was acquired by Deutsche Bank in December 2006, have expressed their frustration at being trapped in the fund. It has posted an 82.4% loss over the last five years and Deutsche said it had no plans to attempt to meet any redemption requests until June at the earliest.
The managers bought the fund during their time at Tilney and say they were encouraged to allocate to property and a significant amount of this exposure was obtained through the £581.4 million Glanmore Property fund and the British Real Estate (BRE) fund went into administration late last year.
The funds, which were both managed by commercial property fund manager and property services group Cardales, were acquired by subsidiary Tilney Asset Management in 2004. After the deal, Cardales, led by director Robert Court, a chartered surveyor, continued to run the fund.
The funds ran into difficulties when the property market turned in late 2007 with Glanmore Property now having suspended redemptions for 48 months.
A spokeswoman from Deutsche declined to provide details on how many investment managers at Deutsche Bank Private Wealth Management currently have exposure to the Glanmore fund or details of when the suspension would be lifted.
She said: ‘We believe in a diversified portfolio including real estate, and BRE and the Glanmore Property fund were among the funds available for investment. Clearly, given the financial crisis, many funds with exposure to real estate have fallen in value.’
One former Deutsche and Tilney manager anticipates a further three to five year wait before money is returned. ‘The problem for investors is that the fund doesn’t own any prime property and they’ve still got banking covenants in place. So even if they completely wind down the fund, it will be three to five years at the earliest before investors get their money back.’
Another ex-Tilney manager spoke of his frustration at losing client money on the British Real Estate fund.