Standard Life Investments today announced it had hit its minimum equity target to launch its first fund investing in speculative property development

The Edinburgh-based fund manager has attracted £167m of equity from a range of institutional investors.

The seven-year fund has already invested around £117m of the fund’s capital in three Town Centre office development projects. Standard Life expects the fund to be fully invested within three years and is targeting an annual internal rate of return of 20%.

Daniel McHugh, head of UK property development, has been appointed to manage the fund.

McHugh said: ‘All three of the projects are prime quality office schemes; a sector which we believe will deliver the best development returns from the market, These developments should ensure that the key attributes of the fund are established from the very start – high absolute returns but with the risk diversified and managed through a portfolio of projects.’