Investors turn towards commercial property investment in the UK in times of global economic turbulence because the asset class has certain characteristics that it is difficult to find elsewhere in the world. This is the opinion of Mat Oakley, director of commercial research at Savills, who explained that the sector is "a pretty unique investment in terms of the security of the income that you get". Among the factors driving this are that the UK has some of the longest leases available, while it is typically the tenant's responsibility to maintain the space and insure the building, he noted.
Mr Oakley pointed out that London, in particular, is attracting attention from investors, because it promises both capital and rental rises. He added that much of the money flowing into the sector is being directed at offices in the city, because it "is probably one of the few western commercial property markets that is actually showing some upward rental growth at the moment. You are getting the best of both worlds". Earlier this month, Cushman & Wakefield published a report that showed London receives the greatest amount of overseas investment in commercial property of any city in the world.
- Wednesday 12 October 2011