Think about it, Commercial property plays a central part of our day to day lives.
The office space you work in, the shop you shop at and the movie house and restaurants you visit are all examples of commercial property. It’s this area that is a significantly important part of our country’s economy and we all add to this economy in a variety of ways.
For instance, have you become aware of the fact that people are living longer these days?
In the 1980s, the standard life expectation was 80 years. Now it’s 90 years. My speculation is that in ten years, the government will hoist the age of retirement from 65 to 70, meaning that people will be required, by law, to work while they are older. This will produce elevated demand for serviced office space.
I’m certain you’ve also taken note of the thousands of individuals migrating to this country looking for employment every year. This puts enormous demand not only on residential property, but also on commercial property.
We are also observing diminishing investment yields in the buy-to-let residential market. This has attracted a growing number of private investors to investing in commercial property. They’ve been enticed by liberal tax breaks and the higher rents that they can charge to commercial tenants.
However, the biggest demand for investing in commercial property is coming from the overseas investors. Among them, the oil-rich countries of the Middle East and Russia are particularly outstanding. Do you know who owns half of all the prime commercial properties in certain parts of London? It’s mostly this collection of overseas investors.
More recently, China and India have added billions to the UK economy. The new breed of Asian investors are attracted to the UK market, because London is one of the top financial cities in the world.
The principal UK financial organisations are very active in this sector. Companies that jump to mind include Norwich Union, Scottish Widows, and General Insurance. Each of these companies are currently investing millions in commercial property, in the form of retail parks, office buildings, and industrial estates.
I could go on and on, but I think you appreciate my point. As with residential property investments, the demand for investing in commercial property is booming, both globally and here in the UK.
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