Commercial property makes a comeback

As well as rising numbers of international investors snapping up commercial property assets in London, local investors are also showing renewed interest in the sector.

Just two years after investors were trying to withdraw their cash from commercial property dealings, the sector is proving popular once more.

According to recent figures released by the Investment Management Association (IMA), the commercial property sector was the third most popular with investors in June.

The renewed interest is due to a rise in the value of commercial property by 15.4 per cent since last August, according to the latest IPD UK Monthly Index.

Ed Trevillion, head of real estate research for Scottish Widows Investment Partnership (SWIP), said, “Prime property in prime locations is always a good investment.

“People never stop buying that. It provides a good solid income stream because of a lease. That agreement will carry you through the bad times,” he added.

Russell Francis of Colliers International said, “The market is pausing for breath after a mini bull run but there is unlikely to be any significant reverse in capital values for prime and good secondary properties.”

However, industry experts are warning investors not to expect instant returns.

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