Following a review by TIME and the Authorised Corporate Director (ACD) of the fund, with effect from dealing days after the 12 January 2017 dealing day, the dilution levy on new subscriptions into TIME:Freehold will increase from 2.5% to 5%.
Explaining the dilution levy
The dilution levy is an additional charge made by the fund to protect existing investors against the costs associated with acquiring an increasing quantity of new portfolios of ground rents arising from the strong inflows into TIME:Freehold.
The levy was originally imposed at 5% on all new subscriptions from October 2014, and then reduced to 2.5% in April 2016. The levy has now been increased to 5% for all dealing days after 12 January 2017. It also applies to top-ups made to existing holdings. The dilution levy will be retained by the fund for the benefit of investors and will help offset the acquisition costs associated with the fund making new acquisitions.
The dilution levy will be applied to all subscriptions over £1,000. The minimum investment amount for TIME:Freehold is £5,000 and the minimum top-up is £1,000.
Why have we increased the dilution levy from 2.5% to 5%?
Both TIME and the ACD are required to review the level of the dilution levy applied on every dealing day and take into consideration the liquidity of the Fund and the pipeline of acquisition targets. On that basis we have determined an upward adjustment of the dilution levy from 2.5% to 5% is appropriate.
What does this mean for your clients?
Existing investments in TIME:Freehold will not be affected by the dilution levy. Prospective new investors should be made aware of the dilution levy as it may affect their decision to invest. It is important to emphasise that the dilution levy does not affect withdrawals, which will continue to be available on normal terms at every dealing day.
We shall continue to monitor the ongoing requirement for the dilution levy at each dealing day. However, it is expected to remain in place for the foreseeable future.
If you have any questions about this please speak to a member of our team on 0207 391 4747 or email us at firstname.lastname@example.org.