Wednesday, Apr 1, 2020
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Kames Capital suspends property income funds over market uncertainty

Kames Capital funds
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UK’s investment management firm Kames Capital has temporarily suspended trading on its property income fund and feeder funds on the back of market uncertainty. The current market conditions are making it difficult for the firm to accurately value properties within its funds, media reports said. 

With that, Kames has blocked further  instructions to purchase, sell or swap shares or units within the funds under the leadership of Richard Peacock and Karen Fox. 

It is reported that Kames’ decision to suspend trading on its funds is in line with the FCA’s rules under COLL 7.2 and its Policy Statement 19/24. The law requires suspension of trading if material uncertainty is applied to more than 20 percent of illiquid assets. 

The firm told its investors that “The challenges in accurately pricing properties is an issue for the entire property investment sector. This is due to a number of specific events that have combined to increase the level of uncertainty in stock markets, which in turn has led to periods of significant selling as we have seen in recent weeks. Chief among these events is the ongoing coronavirus crisis, which I know is a real concern for all of us. At the same time, we have had to contend with a sharply lower oil price as well as the impact of the ongoing Brexit negotiations. These issues are affecting all areas of the stock market, including property investing.” 

Other firms like Legal & General has also suspended its UK Property fund and feeder fund, media reports said. 

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