Commercial property offers haven for income seekers

Gary Hutcheson, managing director of Ignis Real Estate, reveals where the best value lies in this income-driven asset class.

Commercial property is an income-driven asset class and the majority of long term performance has been generated by a high and stable income stream. At its most fundamental level, the objective of active management is to maximise a fund’s income stream, while minimising downside risk. Income has been the driver of total returns of late with the IPD Annual Index’s gain of 7.8% in 2011 made up of 5.8% income return and 1.9% capital growth. We expect this trend to continue for the foreseeable future. In the short term, income returns will remain relatively high but flat and should offset an...