St. James's Place has set up a commercial property fund as part of its portfolio of investment bond and pension funds.
The fund will be managed by a team from Insight Investment led by property division managing director Duncan Owen.
Its anticipated sector profile is 40 per cent retail, 30 per cent office, 10 per cent mixed retail and office and 20 per cent industrial.
Owen, who oversees the management of more than £4.6bn of UK commercial and residential assets at Insight, predicts that the fund should see annual returns of about 8-9 per cent.
Divisional director Andrew Humphries says: “We are delighted to be launching a property fund at this time and believe this is a great opportunity for our clients to gain access to this investment class with a top manager operating within St James's Place's distinct investment approach.”
Owen says: “The fund is well positioned to capture future growth and the recovery in rents already evident in this market. We see the market continuing to build strong and stable returns.
“In the near term, we see the property market producing good income returns of about 7 per cent supported by modest capital growth of about 2 per cent. This should provide total market returns of 8-9 per cent.”