The now-closed Aviva Investors UK Property and its feeder funds are to start returning capital to investors on 2 August 2021, in the “first of a number of payments”.
In a letter to investors seen by Investment Week, Aviva Investors confirmed the fund and its feeders will issue the first payment based on the net asset value (NAV) as at the valuation point on 2 August.
According to its termination notice, the managers anticipate returning approximately 40% of the total NAV to investors, but the most recent correspondence states the firm is "unable to provide a percentage that the payment represents".
Investors are "likely" to learn the exact percentage on 3 August 2021, with settlement "as standard T+4".
Payments will be issued to registered holders of the funds, meaning those who have invested via a platform or a nominee should contact those parties for further details.
As of 30 June, the £367m fund had raised 41.3% cash and held just 11 remaining assets.
Aviva has not said it will pay investors on a quarterly basis, only offering guidance that "the manager will consider the amount of cash held by the funds and decide whether a further payment should be made to investors".
Investors who did not submit instructions to the manager will have their distributions automatically invested in Aviva Investors Multi-asset Core Fund I, which aims to provide an overall average return before charges and taxes of 0.3% greater than its performance benchmark, over a three-year rolling period.
The multi-asset fund tracks a composite index, comprised of 20% MSCI All Countries World index and 80% Bloomberg Barclays Global Aggregate Bond index Hedged GBP.
Aviva Investors UK Property fund is one of two property funds to close following the widespread suspensions linked to the Material Uncertainty Clause, with Aegon Property Income and its feeder funds set to close on 9 August.
Investors in the Aegon vehicle are due to receive "at least 40% of the funds' value on or around 12 August".
Aviva Investors has been contacted for further comment.
Oli Creasey, property research analyst at Quilter Cheviot, said: "Looking at the June factsheet, there is over 40% of the fund's assets already in cash, so I think we can assume that the first payment will be drawn from this and could be substantial. The fund will want to retain some cash to pay its own fees and charges on the property transactions.
"The timeframe for winding a property fund is a tough one to nail down. This particular fund only holds 11 assets and it is mostly various retail assets and offices not in London. Neither of those sectors are particularly in demand at the moment, although the largest asset is a retail park in Essex, which is a class that is becoming more interesting, so that might end up generating some interest.
"We would expect most of the fund wind down in about three months in order to get the sales through for most of the assets, although there are one or two properties that may take longer."