Brandeaux has re-opened its student accommodation fund by launching a new share class with amended redemption terms.
The £876m fund, which halted redemptions in December, said today that it had opened applications for the new dual share class which it will launch on 12 March.
The new share class, which is the same price as the existing shares, has been designed to allow Brandeaux to control the liquidity of the fund by extending the notice period investors have to give between applying to redeem and waiting to claim back money, as revealed by Property Week (30.01.09).
The new terms will provide an exit from the fund six months after a redemption application is made.
The suspension of redemptions for the existing shares remains in place, so existing shareholders have to convert their shareholdings into the new share class.
Once 75% of shareholders have voted to convert to the new share class, Brandeaux can convert the remaining shares to the new class.
The directors retain the right to refuse any redemption request and also to extend the redemption notice period further.
It will also launch new share classes with amended redemption terms for its Brandeaux sterling, euro, and US dollar fund and ‘as quickly as practical’ for its ground rent funds.
Kay Brandeaux, chairman of Brandeaux, said: ‘The redemption terms of only seven business days notice was part of the structure designed nine years ago. This is no longer appropriate in today’s environment.
‘The directors have explored alternative options including selling assets, borrowing, lifting the suspension on existing shares, and in a worst-case scenario, a voluntary liquidation of the Fund. The alternative options were either non-viable, or were severely detrimental to shareholder value.’