Slough Estates chief executive Ian Coull has said industrial property has enjoyed “fantastic returns” over the last three years, and that yields are at, or very close to, their peak.
Speaking today at the Shed Show in Newport he said another year of high yield growth would be dangerous, setting industry up for a “big fall” similar to that of the early 1990s.
He predicted an increasing number of companies looking to invest across the Channel and in
Richard Jones of Morley Fund Management said he expected industrial property to continue being a “boring but steady” performer but predicted property as a whole to show total returns of around 5-6%, compared to 15% over the last 5 years.
He said: “We expect that property is moving back to its proper place in the investment mix between equity yields and bond yields and still offers good security of income growth potential.”
The prospects for the sector were underlined by an announcement by Michael Samuels, DHL Exel Supply Chain’s strategy and business planning director, that his company would be seeking 5m sq ft of space over the next five years.
Capital Economics’ Roger Bootle told delegates he believed interest rates had not yet peaked and would go “an awful lot higher, to 6% and possibly more” adding there was a good chance they would rise to 5.5% in the next couple of months.
However, he remained bullish about the state of the
“In the medium term,” he said, “it is really onward and upward”.
