UK Commercial Property Returns 1.1 Percent In October

By Editorial 22 November, 2013

Returns on commercial property investments in the United Kingdom hit 1.1 percent in October, according to the IPD UK Monthly Property Index.

The index also shows that the capital growth and income return of commercial property in the country were both 0.6 percent last month. Returns on equities, meanwhile, were 4.3 percent, and bonds returned 0.7 percent.

Property values in the three main sectors, retail, office and industrial, were up 0.3 percent, 0.9 percent and 0.8 percent, respectively in the same period. These sectors delivered returns of 0.8 percent, 1.5 percent and 1.5 percent, respectively.

The IPD also revealed that the capital value of retail property accounted for 46.1 percent of all property as of October. This compares to 30.5 percent for office property, 18 percent for industrial property, and 0.2 percent for residential property.

Phil Tily, executive director and head of IPD's UK and Ireland business, said: "Returns are continuing to rise around the UK as economic growth flows out of London. Office returns in the South East outpaced those of central London, while industrial units around the country are seeing stable growth as investor sentiment improves.

"For the retail sector, performance remains more divided by both asset class and region, and the Christmas build up will be a testing time for retailers and landlords. Recent closures show the still difficult trading conditions for many in the sector, and this is subsequently leading to continuing caution amongst asset owners and occupiers."

Tags: Investment | Real-estate Investment | Real-estate | United Kingdom | Retail | Expats |


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