The £2.9bn L&G UK Property fund is set to reopen in October, seven months after the coronavirus crisis forced bricks and mortar funds to suspend dealing.
Legal & General follows Columbia Threadneedle and St James’s Place, which last week announced their funds would reopen following new guidance on valuations.
In a statement on its website, Legal & General said the fund was expected to reopen on 13 October, meaning trades could be submitted from 12 October.
Property funds were forced to suspend dealing in March after their valuers determined the impact of the coronavirus pandemic had created ‘material uncertainty’ over the valuation of UK property.
The Royal Institute of Chartered Surveyors last week lifted that ‘material uncertainty’ clause from UK property assets, giving property funds the green light to reopen.
Financial Conduct Authority (FCA) rules set to come into force in September require fund managers to suspend dealing when the valuation of more than a fifth of their assets is uncertain.
Legal & General said ‘material uncertainty’ clauses applied to less than 20% of its property fund’s assets, ‘and the risk of going over 20% following reopening is limited’.
The fund group added it was satisfied with valuations from valuer Knight Frank and that the fund was ‘well-placed’ to meet investor withdrawals.
‘We will continue to monitor investor intentions and the factors outlined above in the lead up to the planned opening date. Should anything materially change, further communications will be issued.’
The FCA in August unveiled proposals that would require investors in open ended property funds to wait up to six months to get their money out to help a ‘liquidity mismatch’ in the sector.