Good prospects forecast for medium-term investors - commercial mortgages

08 January 2008

In news which may be of interest to those considering taking out commercial mortgages, the UK office market has been predicted as a possible provider of good yields when the current economic volatility quietens down.

Oliver Gilmartin, an economist for the Royal Institution of Chartered Surveyors, said the retail and office sectors would come under greatest pressure this year following the credit crunch, with retail hardest hit by falling sales.

However, he added: "There may be opportunities in the office market if things start to settle down especially for medium term investors as yields may start to look attractive."

Mr Gilmartin said the most likely location for such opportunities would be outside London due to the lower reliance on the performance of global credit markets outside the capital.

Evidence of the generally positive prospects for commercial property over the longer term were revealed by research from Investment Property Databank in 2005, which showed that such investments had only produced negative returns across the market in three of the previous 20 years.