Insurance News Archive
Market normalises for commercial property insurance policyholders
Posted by Dan Winters
Commercial property capital growth continued to rise last month, but the increase was its smallest since August 2009, according to new figures.
A report by the Investment Property Databank has shown that growth rose by 0.8 per cent in April and overall capital growth has increased by 14 per cent in the last 10 months.
Rental growth fell by 0.2 per cent last month, however, which one expert puts down to the market "pausing for breath" after the "spectacular" performance of last year.
Mat Oakley, head of commercial research at Savills, said: "We are now in a situation where investors I think are beginning to accept that they can't just rely on yield shifts for their total return."
He added that commercial property investors now have to consider buying assets that have rental growth opportunities, which he believes will result in a "reversion to normality" for the market.
This comes after a study by the National Landlords' Association found that optimism among commercial property insurance policyholders is at its highest level in three years.
21 May 2010
