Aberdeen Standard Investments is reviewing its investments in high street shops and other brick and mortar retailers as pressure mounts over its exposure to the sector following the gating of M&G’s property fund.
The strategy shake-up is being orchestrated by new global head of real estate Neil Slater, the Sunday Times reported. Slater slotted into the role six weeks ago, having previously run the fund group’s Tokyo office.
The asset manager’s review of its retail assets comes as investors have been pulling money out of its £1.2bn Aberdeen UK Property fund over concerns of worsening valuations in the retail property market which led M&G Investments to suspend dealing on its £2.5bn Property Portfolio.
The fund manager’s real estate division has £43bn of assets under management, two thirds of which are tied up in UK property.
The Aberdeen UK Property fund has one of the highest exposures to retailers compared with peers in the IA UK Direct Property sector.
Aberdeen UK Property had 49.5% invested in retail at the end of October, 18.6% of which was in shopping centres and 8.6% in what it classifies as “standard retail” shops. Another 22.3% was held in retail warehouses.
Standard Life Investments UK Real Estate fund also had an above average exposure to the sector with 33.6% held in retail companies.
ASI told the Sunday Times it was monitoring the situation “closely”. Abderdeen UK Property currently has 12.5% invested in cash.
Portfolio Adviser reached out to ASI for comment but did not hear back.
