Commercial Finance Specialists

Property investors looking for exposure to commercial property with a reduced risk have been using exchange-traded funds, it is claimed.

While the UK commercial property market as a whole remains fraught with difficulties, exchange-traded funds (ETFs) are proving to be especially popular.

Many ETFs have seen steady asset inflows during the last 12 months, as commercial development values started to recover, reports City AM.

They allow property investment vehicles to have exposure to commercial property without having to take the financial risk of buying the property outright, the publication points out.

The majority of the ETF sector in the UK is taken up by iShares, which account for 70 per cent for the total number currently in operation.

James Cannon of Cannon Capital told City AM: "In the last 12 months we've been at the bottom of the market.

"No one's saying we're going to skyrocket out, but if you're living in Europe, English property is now good value (compared to 2007)."

Foreign investors will continue to be attracted to British property because of the weak pound and the promise of "trophy assets" in London, Andrew Teacher of the British Property Federation claimed recently.

Posted by Lisa Fear.