Standard Life Investments has converted its £471 million UK Property Fund into a property authorised investment fund (PAIF).
The fund has been changed from an authorised unit trust into an open ended investment company (OEIC) with a tax efficient PAIF structure.
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The PAIF will allow tax exempt investors to receive income from the fund gross of the 20% corporation tax previously applied to income.
Standard Life said there will be no change to the fund’s name, investment strategy, risk profile and objective and Nigel Chapman will continue to manage the portfolio.
Standard Life Investments head of wholesale and listed real estate, Andrew Jackson, said the fund’s estimated distribution yield will increase from 3.61% to 4.52% for qualifying investors.
"Investors are attracted to commercial real estate because of the income yield it offers. Getting more of that income back into the hands of eligible investors without altering the risk profile of the Fund can only be a good thing," Jackson said.
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By GlobalData"In an environment of low growth and low yields, this is a particularly relevant time to provide long-term investors with the opportunity to access a more tax-efficient, diversified source of income through investment in real estate."
