European property fund re-opened as real estate popularity rises again

Aviva Investors, the asset management arm of the insurer, has reopened its European Property Fund after barring dealing for more than a year to stem massive outflows near the peak of the global financial crisis.

Since then, sentiment towards property investment has turned and inflows have returned, enabling fund managers to meet redemption requests from cash reserves.

‘We've worked hard in a difficult real estate market to bring the fund back to a good liquidity position and are delighted the fund can return to normal trading,’ said Ben Stirling, managing director of Continental Europe Real Estate.

Stirling said the outlook for the fund was increasingly positive. He welcomed ‘clear improvement’ in key economic indicators for the Eurozone and said he believed the worst of the falls in European real estate values were over.

‘Since suspending dealing in the fund late last year we have carefully managed liquidity levels and the sale of properties in a measured manner to get the best possible price,’ he added.

Property has become the most popular asset class for the first time in more than two years, according to figures released by the Investment Management Association (IMA) last week. There are only a handful of European property funds on the market, including Aviva and Premier Pan European Property Share Fund. European fund managers are taking an interest in industrial properties in Poland and vacant offices in Paris.

Standard Life Investments is launching a pan-European property recovery fund with a portfolio that will include office, retail and industrial properties across Europe.