Officials at the Bank of England had been made aware that trading in commercial property funds could be suspended a week before it happened.
The central bank’s financial policy committee was told of the extent of the outflows from the funds in meetings on 28 June and 1 July. Standard Life was the first to suspend trading, doing so on 4 July; the number of suspensions increased to seven by 7 July.
The behaviour of leveraged investors and investors in open-ended commercial property funds could potentially amplify the fall in commercial property values, committee officials said.
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