CONCERNS have been raised over Southend Council’s £30million investments in nosediving property funds.

The council’s treasury management report reveals during the first quarter of the financial year, long-term funds were invested in two property funds.

Roughly £19.1million was managed by Patrizia Property Investment Managers LLP and £11.4million was managed by Lothbury Investment Management Limited.

The council’s investments in the funds dropped respectively from £19.111million to £19.056 and from £11.393million to £11.206 over the three months.

During that period, the council held an average of £92.1million in investments, managed in-house, earning almost £1.5million in interest.

However, speaking at a policy and resources committee meeting on Thursday, Lydia Hyde, Labour councillor for St Laurence Ward, said: “I’m just concerned, is the market getting properly wobbly now and at how much risk is that investment?”

Ms Hyde said the fund, which focuses on London office and retail space could be hit by changes like working from home and the trend to buy online.

Joe Chesterton, the council’s director of finance, said he was confident the council’s investments were balanced and the council was still earning a “significant sum”.

He said: “You get ups and downs with those like anything with property. In terms of the overall strategy the council employs, we have a short, medium and long-term approach to investments.

“If you take your investments out of property funds it can be very expensive. If you do so and then invest in the short-term and the property market changes you will miss a massive hike in interest coming in.”

Mr Chesterton, who said the council would still have assests in London property even if the funds failed, added: “Given what’s happening with the national economy at the moment it would be absolutely disastrous if we withdrew those funds from that particular investment portfolio at this time.”

Councillors’ concerns come as neighbouring Thurrock is struggling with a £1.3billion debt from ill-judged investments.

Tony Cox leader of the council said: “The fact that you’ve got this paper and you can look at our investments is one of the reasons why we would never be in the position of what happened up the road because there was no transparency around it.”