Orn Capital has indefinitely postponed plans for one of the first commercial property derivatives funds in the wake of the departure of its two managers to Robert Page’s Alpha Beta Fund Management.

A spokeswoman for Orn Capital, which is majority owned by Morley Fund Management and has been running the Orn Property Derivatives Fund with internal money, told Property Week: ‘We decided to put the launch on hold because we thought there wasn’t sufficient liquidity for us. Given the current condition of the market, it was not the best time to launch an innovative fund like this.’

The Orn Property Derivatives Fund was set up eight months ago and had hoped to raise £150m from external investors. It was managed by Chris Iley, who had 15 years’ experience in derivatives at CIBC and Lehman Brothers, and property analyst Joakim Franson.

The pair left Orn at the end of August and are now working with former Lehman Brothers banker Robert Page on residential property derivatives. Iley said he and Franson had resigned before liquidity issues hit the global economy in August.

‘We had resigned before there was any talk about the credit crunch,’ he said. ‘Also Rob and I would not launch Alpha Beta if we felt the credit crunch had forced major concerns about this market. The current situation has if anything proved how useful derivatives are as a hedging tool.’