Commercial property fails to charm investors
22/02/2007 - Standard Like cuts it exposure to commercial investments
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Falling rental yealds have been blamed on the fall in institutional investors willing to commit to commercial properties. Standard Life have cut back on their commercial investments with high street retail properties being firmly of the agenda. The main reason for the fall out is the low returns it yields compared with other less risky investments.
Whilst Standard Life are trimming back their commercial portfolio, others are upping their exposure. Alliance and Leicester moved into the buy to let market last June and the Abbey has expanded into the rental area. There are strict criteria to borrowing for rental properties and most lenders look for at least a 125 per cent pay rate on rental income and a loan to value of at no less than 85 per cent.
