Economic uncertainty and its effect on bonds is making commercial property investment an attractive option.
Economic uncertainty is making commercial
property investment much more attractive, it has been claimed.
Isis Property Trust manager Ian McBryde told Fund Strategy magazine that falling bond yields is making
commercial development a better option for those looking to invest capital.
As of June 30th, the Isis portfolio had achieved a dividend yield of 8.4 per cent, while British government ten-year gilts returned just 2.8 per cent, the publication notes.
However, Mr McBryde has insisted that commercial property investment is not likely to produce short-term gains, while assets in the "secondary" non-prime market are also likely to be disappointed.
He explained: "If you're in the secondary market, however, I don't think the income's so secure.
"Investors have picked up on this and the secondary market has remained flat around its crisis levels."
The chief executive of Hargreaves Lansdown Peter Hargreaves recently claimed that public sector cuts will create a "glut" of available commercial properties, which is likely to drive rental prices down.
Posted by Tess Nelson.
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