Fund manager M&G has temporarily suspended dealing in its M&G Property Portfolio Fund and feeder fund after a sharp rise in investor withdrawals.

The temporary suspension came into effect from midday yesterday (4 December).

During the indefinite suspension the fund’s annual charge will be reduced by 30% and income payments will continue.

Fund managers Fiona Rowley and Justin Upton have written to investors to explain the recent problems.

They wrote: “In recent months, continued Brexit-related uncertainty and ongoing structural shifts in the UK retail sector have prompted unusually high outflows from our property fund for retail investors.

“Given that these circumstances and deteriorating market conditions have significantly impacted our ability to sell commercial property, we have temporarily suspended dealing in the interests of protecting our customers.”

A number of property funds, including those of Standard Life and Aberdeen, were temporarily suspended in 2016 following the Brexit vote.

M&G says the recent issues have caused difficulties in selling commercial property but firm hopes that the suspension will  allow it to increase cash levels to allow it to sell assets in a more “controlled manner.”

In the year to 31 October the fund sold 14 properties for £374.8m.

The fund has been affected by the problems on the High Street which have seen many retailers go bust and vacancy levels rise

considerably as empty shops have become a more common sight.

However M&G says ‘prime retail’ is outperforming other retail sectors, regional shopping centres are doing well and supermarket propery values have been resilient.

The company says it is unable to predict how long suspension will last but it will be reviewed on a monthly  basis.