St. James’s Place is set to close all of its open-ended property funds after 20 years in the sector, including its Property Unit Trust, Pension and Life strategies.
The funds, launched in 2004, manage around £1.8bn property assets.
In a statement, SJP said that the decision comes after a challenging period for the sector as a whole.
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Since suspending the funds last year, SJP said it has continued to assess the property market, citing caution from investors around property funds following changes to working patterns following the Covid pandemic, which has led to a reduced demand for office space.
Meanwhile, the firm pointed to proposed regulatory changes which may result in the introduction of notice periods for funds holding more illiquid assets, with the wealth manager suggesting the changes could deter investors from investing in open-ended property funds further.
The mandates were gated on 20 October last year, to avoid having to sell properties below their fair market value to generate cash.
Tom Beal, group investment director at St. James’s Place, said: “Since we launched our property funds in 2004, the marketplace and our investment processes have evolved substantially, with the pandemic significantly impacting the wider property market.
“Following the suspension of the fund in October 2023, we have reviewed all options available to us and concluded that the best course of action is to wind down the funds. Doing so over a period of time will allow us to maximise value for our clients.”
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Invesco Global Real Estate has been appointed to manage the wind down of the funds, with the firm expecting the process to take two years to sell the majority of assets.
The closure is the latest in a wave of recent wind downs in the open-ended property sector.
In October last year, M&G announced its intention to shutter its then £565m open-ended UK property portfolio due to “declining interest in open-ended daily dealing property strategies” from UK retail investors.
A day later, Canada Life shuttered its PAIF after assets under management more than halved from £254m to £102m, leaving it “no longer commercially viable”.
