More than GBP2.5bn worth of net investment was raised in the final quarter of last year by UK pooled property funds, according to IPD.  

The quarterly inflows captured by the IPD Property Fund Vision Handbook Q4 2009 – which monitors 74 UK-focused pooled funds with GBP31.1bn of properties – represents more than a ten-fold increase on the third quarter’s GBP235m.
 
Seven authorised property unit trust constituents accounted for just under half of the new investment, at GBP1.2bn – a considerable proportion given these funds account for less than 20 per cent of the aggregate net asset value of the handbook. This compares with GBP345m in Q3 and a net outflow in Q2 of around GBP80m. 
 
The bulk of the remaining new capital was raised by nine managed property funds, which drew GBP490m, over 90 per cent of which was focused on three of the nine managed funds – Aviva Investors Pensions Property Fund, Legal & General Managed Property Fund and Threadneedle Pensions Property Fund. A further 18 other balanced funds attracted GBP563m.
 
IPD estimates that SWIP Property Trust raised just under GBP600m last quarter – the largest individual fund raising for the second-successive quarter – almost equal to the entire collective raising of the remaining six authorised property unit trusts. In contrast to Q3, all six of these other funds saw positive net investment in Q4 2009, led by M&G Property Portfolio, which raised circa GBP200m, and Aviva Investors Property Trust, which saw inflows approaching GBP180m.
 
Cameron McVean (pictured), head of fund services at IPD, says: “Volatility has become the norm in UK commercial property markets in recent years; record negative returns have been followed by new highs in short succession. Underpinning these return swings have been investors – and their advisers – decision to re-invest in commercial property. But shrewd capital allocations will only be made on the basis of sound property data, analytics and thorough due diligence of funds and their managers.”