"The Committee has previously highlighted the risks around open-ended property funds. Since the referendum, these had seen increased redemption pressures. The FPC was briefed by the FCA on the extent of outflows from these funds and on the possibility that funds could suspend redemptions in the near term," the minutes said.
Seven U.K. open-ended commercial real estate funds subsequently suspended dealings to avoid fire sales of underlying assets. These belonged to Aberdeen Asset Management, Standard Life, Aviva, M&G Investments, Henderson Global Investors, Columbia Threadneedle and Canada Life.
Critics of the funds say the illiquidity of commercial real estate make it an unsuitable asset for open-ended funds, to which investors are allowed instant access.
On Tuesday, Bank of England Governor Mark Carney said the bank had raised concerns about open-ended real estate funds before the Brexit vote hit the agenda.
"We did flag these risks in 2015," he told a Treasury Committee hearing on Tuesday, adding that U.K.'s banks' exposure to these funds was fairly modest in recent historical terms.
He said these funds were at "an extreme end of a more general issue … there has been a general trend for funds that have daily liquidity (requirements) to invest in illiquid securities … like emerging market debt."
Also at the committee hearing, Deputy Governor Jon Cunliffe said the funds were looking to sell assets while avoiding fire sales.
"They are out seeking the opportunity to liquidify their portfolios, but that it is not at any cost … they are trying to do it in an orderly process," he said.