Investors have returned to the commercial property market, but they could be in for a rude awakening, it is claimed.
A full year of positive returns has seen many
property investment firms return to the market, it has been claimed.
However, while commercial property funds may have benefited from an average return of 10.83 per cent, the value of the average
commercial development portfolios is still 26 per cent lower than three years ago, the Independent notes.
This is raising fears that property investment funds could be in for another shock, as financial advisers start to turn away from the sector.
These concerns reflect a "justifiable uncertainty" in light of proposed public sector cuts, Reita chairman Patrick Sumner told the publication, although he played down the possibility of major problems.
"We are in the early stages of a slow economic and commercial property market recovery, in the course of which there will be the odd lurch," he said.
Money Marketing recently advised pension savers that there were "signs of life" in the commercial sector, with property investment remaining an attractive option for supplementing retirement income.
Posted by Allan Flowers.
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