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M & G temporarily suspended the property funds listed above from trading from midday yesterday, 04/12/2019.  This means that you can’t invest any new money or withdraw any current investments from these funds.

Brexit related uncertainty and ongoing structural shifts in the UK retail sector have prompted unusually high outflows from retail investors for M & G.

M & G have temporarily suspended dealing in the interests of protecting their customers (our clients too).

Commercial property and property funds should be bought and held for the long term.  Property is a long-term investment asset and it is not as liquid as other assets, for example shares.

Suspending the funds now will give the fund managers time to restore the cash levels by selling assets in an orderly manner and preserve value for investors.

Whilst suspended M & G are waiving 30% of its annual charge on the two funds.  Hopefully this will help any frustrated customers of the fund.  The funds will still be maintained and managed actively by M & G during the suspension.

 

Perspective

The majority of our clients are in tactically and actively managed portfolios or multi asset funds.  This suspension should not impact on these clients.

If you are invested directly in one of the two property funds named above, don’t be concerned.

You should note the following:

  1. Only a small proportion of your total investment will be in commercial property
  2. Over the medium to long term commercial property is a great asset to invest in
  3. Commercial property has a place in a diversified portfolio, it helps reduce risk overall

 

Summary

Maintain the status quo, think long term.  Investing is about long term returns.  When the suspension is lifted your portfolio can be reviewed.  Over the long-term commercial property is a great asset.

 

Steve Speed 05/12/2019