Investors in Schroders’ West End of London Property Unit Trust (WELPUT) want to withdraw a fifth of its £1.09bn (£836m) value as Brexit looms closer, it is reported.
WELPUT has already paid out the maximum requirement of 10% of asset value in each of the last two years, selling investments to meet its obligations to investors. It is rumoured that the latest withdrawal requests could result in further sales or restructuring of the fund. At least one investor is reported to be considering a bid for the fund’s entire portfolio.
WELPUT, whose assets are managed by Grafton Advisors LLP, owns 10 prime London office buildings. Although initially investing only in the West End of London its strategy changed in 2014 enabling it to invest in the City and emerging districts like King’s Cross and Whitechapel.
Investors’ wish to exit the fund appears to show a significant lack of confidence in the central London commercial market. However, it is well worth remembering that while most UK economic indicators have been severely impacted by major Brexit developments – such as the initial Brexit vote and the invocation of Article 50 – they have proved resilient in the medium term.
EU leaders are still expected to agree a Brexit deal at the end of November which is likely to be yet another watershed for the UK economy.