Deep Dive: Positive outlook for commercial property

Retail warehouses delivered 21.9%

Justin Upton, manager of the M&G Property Portfolio, dives into the property industry

Expectations are often different from reality. This was true of UK commercial real estate in 2021 where total returns of 16.5% were markedly stronger than the IPF consensus autumn forecast of 1.5% for the year. This strong return was largely reflective of a better-than-expected economic recovery, with GDP returning to pre-pandemic levels for the first time in November. Meanwhile, investor sentiment had improved, reflected in yield compression and £64.9bn of transactions. The industrial sector was the standout performer, but retail warehouses also delivered 21.9% - both segments benefiting f...