Managers still positive on commercial property

Fund managers are generally positive on the long-term pros- pects for commercial property despite falls in returns, which still exceed those of other asset classes. Total returns for UK property dipped to 6.7% in 2001, reflecting a slowdown in the economy and ending a five-year run of returns over 10%. This still beat the All Share equity return of -3.2% and returns on long-dated gilts of 1.3% and cash of 5.5%, according to the IPD annual index. L&G calculates the long run nominal expected return on property to be around 7% pa, giving a real expected return of around 4.5% pa. Andrew ...