A listed property income trust managed by F&C said today that it would still pay a dividend, in spite of a fall in property values and increased gearing.

Property income trusts are designed to provide income to investors, so the dividend is crucial. Based on current share prices, Isis currently yields around 10%.

Isis Property Trust 2 also said it would change its name to IRP Property Investments to differentiate it from the original Isis Property Trust, also managed by F&C.

Isis revealed a 20% drop in net asset value to 121p a share in the six months to 30 June.

This was driven by a 12% fall in the value of its property portfolio to £190m.

‘The short term outlook for property has deteriorated over the last three months, reflecting concerns about the economy and financial markets.’

Fund manager Ian McBryde said. ‘Expectations are that a weak year is in prospect for 2008 and into 2009.

‘Beyond this, however, the managers predict positive real rates of return and continue to believe that performance will be largely income driven.’