Investors urged to look beyond commercial property - commercial mortgages

05 April 2007

UK investors are being advised to look beyond commercial property and consider other investment opportunities such as residential development and hotels.

Experts at Fidelity International urge investors to explore opportunities other than commercial property, following research finding that the vast majority of bricks and mortar portfolio funds are made up of offices, retail and industrial holdings.

The popularity of commercial property may signal increase uptake of commercial mortgages in the future as businesses seek desirable premises in the long-term.

"Funds that invest in property securities can reach much further into the property market for investment opportunities, offer superior liquidity and, importantly, are better placed to take advantage of key worldwide trends and offer a truly diversified portfolio to investors," explained Richard Wastcoat of Fidelity.

Warnings have surfaced of a lack of prime commercial property in the UK, while Gerald Ronson of Heron International recently stated that the UK commercial property market could be heading for problems, due partly to investor over-confidence.

Trends highlight a number of areas becoming popular among investors including residential property development, social housing and healthcare.