Commercial real estate investors should not put all their eggs in one basket by ensuring they have properties in a mix of locations in their portfolios. This is the advice of Mat Oakley, director of commercial research at Savills, who explained that this is not only a good way to protect against falls in one market, but also an excellent opportunity to diversify risk.
"Arguably, you would say that in a mixed portfolio, you should have some of your money in somewhere that is safe and secure and some of your money in somewhere that potentially offers very high growth and high return," he stated. Mr Oakley commented that the Asian property sectors are one option for investors seeking assets with growth potential, while London is still considered to be a safe haven by many.
The recent Royal Institution of Chartered Surveyors Commercial Market Survey for the third quarter of the year revealed that London is the only part of the UK where demand from investors is still relatively strong. According to the organisation, foreign buyers are helping lift the city's real estate market, despite activity falling back slightly amid the wider European problems with sovereign debt.
- Thursday 20 October 2011