Sustainable returns still possible despite some risks on the horizon

Commercial property

This week's Conjecture panel discusses the likelihood of sustainable returns from commercial property in the next three to five years

Commercial property may be starting to look expensive relative to equities but fund managers Rupert Sheldon of Henderson and John Wilson of Britannic believe the asset class can still deliver sustainable returns over the next three to five years. Predicting rental income of some 6%, commercial property only needs to provide marginal capital growth to offer investors a 9% per annum return, Wilson noted. That is not to say the two do not see some risks on the horizon, namely in the form of Government interference in the market as well as the knock-on impact of any downturns in the global mar...