Professional advisers are recommending that investors avoid commercial property funds and, where appropriate, sell out in the face of a continued downturn in values. Financial Times.

UK commercial property funds saw their first fall in total returns in 15 years last month.

Roddy Kohn, of investment adviser Kohn Cougar said: “Property is not attractive for new investors at this moment, while it is unlikely to be in your interest to stay in these funds if you are looking for capital growth.”

Kohn said an added worry was that if liquidity problems within retail unit trusts became too great they could restrict redemptions. Many retail funds such as New Star and Norwich Union raised the cost of exiting their property funds during the summer owing to net withdrawals.

Fund managers are speculating the dowturn ill last between three months and two years. CB Richard Ellis, the property adviser, predicts values will fall in the first two quarters of next year.