Unconventional Assets Getting Attention From Commercial Investors
In a bid for growth, development potential and long-term capital appreciation, commercial property investors are turning to unconventional assets.
These include car parks, churches, cemeteries, and even brothels, as well as boarding houses, cold storage facilities, and caravan parks, according to Vanessa Rader, Head of Research at Ray White Commercial.
Rader said that when interest rates hit an all-time low, commercial investors started looking at ways to diversify their portfolios. Many sought security in assets that could remain operational during lockdowns, such as medical centres, service stations, childcare centres, and fast food outlets. This ongoing demand rapidly drove up values for these unique properties.
She said investors are now scouting for the next rising asset class.
Rader added, that investors continue to navigate the risk curve, attracted to the potential returns on these unique commercial properties This evolution in investor appetite indicates an interesting shift in commercial real estate trends and portfolio management strategies.