View more on these topics

Commercial property on the up

The UK commercial property investment market is in robust health and with the exception of some sectors of the retail market, such as high-street shops, the outlook is good.

Contrary to expectations, yields on most commercial property are falling and this trend may continue as inter- est rates fall. Although the manufacturing sector is in recession, strong economic output from distribution continues to sustain demand for industrial property. Compared with residential property, where the average house price rose by 164 per cent in the 10 years to June 30, 2005, the capital value rose by only 48 per cent, according to the Halifax house price index. But strong rental income meant the return over the 10 years was 205 per cent.

The fund I like best is New Star property unit trust. It holds about 60 per cent in property, with 68 per cent invested in office property, 10 per cent in retail warehouses, 12 per cent in ind- ustrial property and 7 per cent in retail units. It also holds about 16 per cent of its portfolio in property shares. This part of the portfolio is managed by Stephen Whittaker. The balance of the portfolio, amounting to about 22 per cent, is invested mostly in deposits and convertibles.

Past performance is excellent – up more than 63 per cent to August 1. It has shown a positive return in the past five years, unlike the average UK equity fund which showed a loss over the same period.

Every portfolio designed for realistic or conservative investors should have 10 to 15 per cent in commercial property and, with the first-class management team at New Star, this trust should continue to do well.


Industry criticises 4m stakeholder drive

Scottish Life head of pension strategy Steve Bee criticises the amount that the Government is spending to promote stakeholder when he says it is unsuitable for millions of people. Bee says it is crucial to get the public to save more but claims it is foolish to pretend that pouring money into this sort of […]

Kenmir steps down from intermediary role at FSA

David Kenmir is stepping down as head of the FSA’s ret- ail intermediaries sector. The role will be taken on by the regulator’s small firms division. Kenmir has been in charge of the retail intermediaries sector team since it was set up 18 months ago but is relinquishing control as it expands to include mortgage […]

Mortgage Trading Exchange now available to all introducers

Mortgage Trading Exchange is now available to all introducers in the UK following a roll-out of MTE stand-alone.Every mortgage introducer will now be able to use the MTE regardless of what sourcing orpoint of sale systems they are currently using.Rather than using various lender websites, each of which work in different ways and may require […]

Jon King

Defeat is not a word that comes easily to Ship chairman and managing director of Hodge Equity Release, who is determined to see the release market reach 5bn in the next five to 10 years, says Nicola York

Tech winners keep on winning

By Ali Unwin, chief technology officer & fund manager, Neptune Artificial intelligence, driverless cars, big data. As technological advancements – and disruption – increasingly dominate headlines, Ali Unwin sets out six key themes he is watching in 2017. Read more Important Information Investment risks Neptune funds may have a high historic volatility rating and past performance […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment