The company announced last month that, after pressure from investors, it would wind up its range of Ground Rent and Dual Asset funds which were originally suspended in July last year.
This wind-up will include the £353m Ground Rent Income Fund, the £87m Ground Rent Portfolio Fund and the £27m Ground Rent Portfolio Plus Fund.
In addition, the Dual Asset funds, which invest in the Ground Rent funds and Brandeaux’s range of Student Accommodation funds, will also be wound up. The sterling, US dollar and euro denominations of these funds total around £224m.
The Student Accommodation funds will not be wound up.
Releasing liquidity
In a statement dated 16 December, Brandeaux said: “Given the desire that has been expressed by investors in the Ground Rent funds to realise liquidity, and following the positive results achieved in property sales so far, the directors of the Ground Rent funds have resolved to market and sell all the remaining properties within the Ground Rent funds.
“Once completed, the intention is to wind-up the Ground Rent funds.”
As the fate of the Dual Asset fund range is intrinsically linked to that of the Ground Rent and Student Accommodation funds in which they are invested, Brandeaux said it has taken the decision for these to also be wound up.
In managing the wind up of the funds, Brandeaux said it has now completed a number of sales from within the Ground Rent portfolios, releasing liquidity worth around £173m, as per an announcement made in September last year.
Brandeaux said the £173m worth of sales represent around 37% of the total remaining assets in the funds and that the value achieved was “in line with the directors’ expectations” and so the value of the share price for the funds remains unchanged.
The company also said a potential buyer for the remaining properties, as reported in September, failed to complete, describing this as “unexpected and disappointing”. Although, it added that the continuing interest in these properties is “very positive and a reflection of their inherent value”.
Furthermore, Brandeaux said it did not want to wait until the wind up of the Ground Rent funds is complete “before releasing to shareholders the proceeds of sales achieved thus far and so…it is intended that the net proceeds will be released to shareholders as quickly as possible”.
The company said the proceeds would be released to investors “early in the New Year”.
In order to ensure shareholders benefit fairly from the sales, Brandeaux said it will make compulsory pro rata share redemptions to all shareholders based on their current percentage shareholding.
