Morgan Stanley will shut down its €852 million ($1.19 billion) P2 Value fund, becoming the third asset manager to liquidate a German mutual property fund in a month after too many investors wanted their money back.
The P2 Value fund's managers will sell all of its 34 properties, spread across Europe, Japan, Hong Kong and the U.S., by Sept. 30, 2013, according to a statement on the website of Morgan Stanley's German unit. Money will be returned to the fund's investors, mostly German, in half-yearly installments.
Morgan Stanley follows Aberdeen Asset Management and Kanam Grund Kapitalanlagesellschaft in announcing the closure of a mutual fund. The companies failed to raise enough from disposals to repay investors before a deadline forcing them to open the funds for redemptions. All three halted redemptions two years ago as investors scrambled to withdraw money as the financial crisis escalated.
The liquidations are the first for Germany's €88 billion mutual property fund industry; seven other funds are suspended for redemptions.