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Commercial Property Sector Regaining Confidence

Confidence in the commercial property sector is growing once more, as the final large commercial property fund announces that they will re-open the fund on December 15th.

Confidence in the commercial property sector is growing once more, as the final large commercial property fund announces that they will re-open the fund on December 15th.

Commercial property fund, Aviva Investors, has announced that they will open the fund for trade again next month, following the decision to temporarily close the £1.8 billion on July 5th in the midst of Brexit uncertainty.


Previously, the fund had advised that it may not re-open until next year, but Aviva has said that they have ‘implemented a robust structured property sales programme to boost liquidity’, meaning they were able to bring the opening forward.


After the announcement of the referendum result, Aviva was one of several major funds to suspend transactions temporarily or to apply large discounts, in order to prevent investors from extracting their money in the period of market uncertainty.


Aviva are the final fund to re-open, with all other large commercial property funds having lifted their suspensions and removed discounts.


Following the temporary suspensions, the funds who have now re-opened have announced that they were able to boost their cash reserves during the closures, but have advised that the capital they hold will deliver a lower return than previously.


This will mean that investors receive a lower return, but they will be able to sell their holdings more easily, should they wish to trade these.


Elsewhere in the commercial property market, confidence has returned to the commercial property sales market as well, with CBRE announcing last week that the sector witnessed its first month of growth in October following the referendum.

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