Investment in commercial property

Tangibility
Many investors, bruised from recent experiences with stockmarkets, value the traditional “bricks-and-mortar” qualities of a property fund.

Attractive historic returns
The average commercial property fund has outperformed equities, gilts and cash over 1,3,5 and 10 year periods*.

A secure, stable and relatively high underlying yield
Rental income from commercial property generated within the fund averages around 6.5% currently – higher than yields on other asset types.

What are the advantages of investing within a commercial property fund?

Income tends to be fairly secure due to the length of a typical lease and the low level of tenant defaults of properties help within a typical property fund.

Low volatility
Historically commercial property funds have demonstrated a much smoother performance than equities. And commercial property has proved to be much less volatile than residential.

Low correlation with other asset types
Property has tended to perform differently from other asset types at the various stages of the economic cycle. Analysis of past returns shows us that equities and gilts are much more closely correlated. This means that a property fund has a valuable role as a diversifying asset class.
*IPD Monthly Index August 2004.

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What are Commercial property funds?

Investment in commercial property