Long-term money invests in commercial property
The latest quarterly report from the Association of Real Estate Funds shows that UK institutional funds are returning to the commercial property market as returns improve.
The report says that unlisted pooled property funds raised a total of £3.2bn of new money in the final quarter of 2009, which is the highest figure since records began in 1998. The previous peak was £1.7bn during the 2006 boom.
The Financial Times reports AREF chief executive John Cartwright’s comments as follows: “This marks the second quarter of positive net sales, signalling the resurgence in popularity for property funds. Interestingly, while retail investors remain active, we have also seen significant new money from institutional investors who tend to have longer-term investment horizons.”
The newspaper adds, however, that the speed and strength of the recent surge in returns has led to some fears that there may be another dip in values in the near term. It seems that while longer-term investors are flocking to the sector, confidence elsewhere remains more shaky.
