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£439m ($554m) real estate fund managed by abrdn 
ABDN The fund announced in a statement on Wednesday that it was dissolving the partnership after a proposed partnership with a rival fund did not receive sufficient support from shareholders.
Listed real estate funds have struggled in recent years as sharply rising borrowing costs and post-pandemic office vacancies have depressed the value of commercial real estate and led to a surge in customers withdrawing money from real estate specialist funds. .
In response to the difficult situation, some real estate funds are pursuing partnerships to strengthen their finances.
Abrdn Real Estate Income Trust (API) aAPI said a majority of its shareholders voted to support its merger with rival Custodian Property Income REIT (CREI), but the proposal fell short of the required 75% support threshold.
“Given these results and the challenges that API will continue to experience as an independent company, the API Board will take steps to implement a managed winddown going forward,” API said in a statement.
API told shareholders it aimed to “improve returns”, but a spokesperson said profits from the sale of the assets were likely to be lower than they would have been had they been sold normally. The downsizing will also require approval from API shareholders.
CREI said in a statement that while it was disappointed with the outcome, the merger was not critical to its strategy.
($1 = 0.7920 pounds)
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