Standard Life Investments has frozen redemptions for six months in six of its life and pension property funds.

More than 200,000 retail investors will be unable to take out their money in Standard Life’s £2.7bn UK Unit Linked and Pensions Property Funds as the fund manager halted withdrawls from the fund because it was struggling to sell assets.

A freeze on redemptions will allow the fund manager more time to generate cash and manage any ongoing and planned sales.

John Gill, managing director, customer services at Standard Life said: ‘Our decision to introduce a queuing system on some of our property funds is designed to ensure fairness. The continued deterioration of the UK commercial property market means we have to introduce some controls over the programme of sales of properties from within certain funds.

‘Whilst this is an established method of dealing with such a situation, we also appreciate it is an unwelcome one for some investors. However, failure to act now would increase the risk of us not being able to achieve the best deal for all investors in the fund, including those who intend to remain invested over the long-term.

‘Despite the existing difficulties for commercial property we firmly believe that our property funds are well positioned for recovery over the medium to long term.’

The affected funds are the Property Fund, the Property Investment Life Fund, the Pooled Property Fund, the Property One Fund, the Pension Managed Property Fund and the Individual Property One Fund.

The move by Standard Life follows the example of Aviva Investors which last week suspended withdrawls for six months in its £2.9bn Norwich Union Unit-Linked Property Fund.

New Star also closed redemptions for six month in its £460m International Property Unit Trust Fund in November – M&G, Scottish Widows and Scottish Equitable have also been forced to halt outflows.

The funds have all been hit by a 35.5% fall in commercial property values last year according to IPD, while the lack of bank lending has meant there are few buyers in the investment market.

Topics