Pinder Fry & Benjamin has been forced to put its £20m strategic land fund on ice after its backers pulled out.

The fund manager has delayed the launch to seek new funders after Gladman subsidiary Fox Land withdrew equity investment.

The directors of the residential development land specialist were to personally invest £16m. The fund predicted annual returns of 21% on the basis of planning consents.

Kevin Edwards, director at Gladman, said: ‘Given the continued decline in the economic climate, we decided that we were no longer willing to invest in the fund.

‘It is part of the same story across the whole property industry – and we were no exception.’

Pinder Fry is this week to launch a third offer for its data centre fund that will close at the end of May.

It hopes to raise £40m to increase its co-invested share with European data centre developer E-shelter in three centres – in Frankfurt, Munich and Zurich – to 30%.

Gregg Spivey, senior product developer at Pinder Fry, said: ‘Most people now have an iPod or download music or upload pictures on Facebook, so investors can see the growth and understand the demand.

‘We chose £40m as a target because it is the amount that we need to deploy but, if we raise more, then we will have no problems identifying other possible sites and opportunities to invest in.’

The fund has no debt and predicts 16% annual returns.

Pinder Fry bought a 50 acre brownfield site at Saunderton, near High Wycombe, for £16.2m last year. Last month, it won planning consent for an 830,000 sq ft data centre that will be the UK’s largest, and is seeking a prelet. The development will be phased over four buildings to provide 400,000 sq ft for data centre occupiers such as government bodies, banks and telecoms companies.