Kames Capital has reduced the level of the “fair value adjustment” on its £515m Property Income fund from 10 to 8.5 per cent but warned there is not enough evidence for an accurate valuation.
The portfolio and its feeder funds joined the ranks of those vehicles making downward adjustments as the EU referendum result shook sentiment in the commercial property market.
This saw Kames implement a 5 per cent fair value pricing adjustment on June 28, with this being upped to 10 per cent in July.
Kames noted that while a fair value adjustment remained in place “in the expectation of further pricing falls”, property values had not fallen as much as initially expected.
“At the same time, the market has benefited from a general improvement in sentiment,” the company added.
However the firm warned that there continued to be “insufficient evidence in the market for property valuers to form an accurate judgement on valuations”.
A number of property funds have showed signs of improving conditions in recent weeks, with F&C moving its offering from bid to mid pricing and Legal & General Investment Management and Aberdeen also reducing fair value adjustments.
However, there has been no change among the property funds which suspended trading. Some five vehicles remain closed to redemptions with Aviva recently warning its gating could last until March 2017.
