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Bolton says Pifs are set to transform property sector

Fidelity Investments&#39 star stalwart Anthony Bolton believes the Treasury&#39s proposed property investment funds have the potential to transform the quoted property sector in the UK.

Speaking at the Thomson&#39s Group London Professionals dinner last week, Bolton, who manages £3.5bn for Fidelity, tipped the Government&#39s property investment vehicle for success.

Pifs are likely to follow the Reits model used in the US where there is no effective tax charge within the vehicle, providing it distributes a big chunk of its income to shareholders where the tax liability occurs.

The Treasury has expressed a preference for Pifs to be listed on the basis that this will facilitate wider investor access and market scrutiny.

Pifs will be able to invest in the commercial property market, with a requirement that a minimum percentage will have to be held in commercial property.

Responses to the Treasury&#39s consultation paper on flexible investment in property are due next month.

Bolton said: “Pifs are a very interesting area with the potential to transform the quoted property sector in the UK.”

Hargreaves Lansdown senior analyst Meera Patel says: “Pifs look slightly more lucrative but the problem of limited supply of real estate will still be there. These funds will certainly fill a gap and attract money, if only for a few years.”

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