Why is it Smart to Diversify?
Commercial property investment trusts exhibit some unique and valuable characteristics which provide diversity from other asset classes, such as shares, fixed interest investments, and even residential properties.
Natgen’s managing director, Steven Goakes, explains why it’s important to include commercial property in your investment portfolio.
What range of returns should I expect to receive from an unlisted Property Trust?
Higher Income Yields
The income earned from commercial property can be generally higher than other asset classes, which is particularly valuable where investors are relying on the income yield of their investment for living expenses.
Stability and Consistency of Income
Due to the relatively long lease terms applying to commercial property. Lease terms ranging from 3 years up to 10 years or more provide consistent and predictable income streams over
time.
Capital growth potential is based on the income growth potential and other measurable factors
Commercial properties are often valued on the basis of the potential (and actual) rental return being achieved. Other relevant factors include economic activity, interest rates, and
the commercial success of the area surrounding the property.
Focussed, professional management of the investment and asset
Commercial property investment trust managers, such as Natgen, provide a wealth of experience and expertise in the management of the investment and assets. Quality of management is a significant point of difference and investors should ensure that their manager is fully licensed, has a track record, and appoints industry leaders to assist with valuation, due diligence, and compliance.
The above chart shows the consistency of income return (in yellow) from commercial property over a long time period (in this case over 35 years).
Whilst capital return shows a level of volatility, income returns are very consistent.
Natgen provides clients with well-considered, carefully measured commercial investment opportunities, accompanied by professional advice from our experienced leaders.
If you’d like to be notified of future investment opportunities, request an Investor Information Pack or contact us directly at invest@natgen.com.au
