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19 Mar 2014

Commercial Property Investment Trusts Expected To See Strong Performance In 2014

Over the past few months, investment specialists have been talking about commercial property as potentially high-profit, low-risk investments. That is why investment experts predict that commercial property real estate investment trusts (REITs) are likely to become more popular in the UK this year and in the future.

Commercial REITs are investment groups that group together to buy properties that individual investors may find too costly to purchase on their own. These could be hotels, warehouses, shopping centres or other properties. These groups made the most of 2013´s strong growth and property experts expect that 2014 will yield even better returns, according to property investment group, IPIN Global.

As the British economy continued to recover in 2013, the UK commercial property market saw stable growth that resulted in an increased confidence for investors. Figures released in IPD´s monthly analysis suggest that in 2013 returns on investment in the UK commercial property market hit 10.9%, up on a previously estimated 8.6%. The outlook for this year remains positive, with some investment companies predicting returns of up to 12%, IPIN Global reported on its website.

As confidence in the market returned, an increase in investments in 2013 led to commercial property REITs saw their stock´s value increase by 3.8%, reaching its highest level since March 2010. Meanwhile, returns stood at a relatively high level of 6.8%, partly due to the 0.6% rise in rental returns, the IPD report said. Predictions of an even stronger economic performance this year suggest that REITs will enjoy another good year.

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