Is it time to move back into commercial property?

All in all, the group continues to predict close to double-digit returns from property over the longer term although it warns against investing in the UK market over the next few months.

Slow recovery

Elsewhere, Patrick Sumner, head of property equities at Henderson, is also fairly bullish, highlighting fundamentals on a gently sloping recovery path.

‘The greatest challenge is negative investor sentiment, stemming from a view that the upside has already been taken,’ he said.

‘If you had invested on 8 March 2009, the return would have been 100%, but a doubling of a small number does not result in a large number. In the long game, we are still not halfway through the first half and there will be opportunities as markets clear over the next few years.’

Sumner suggests property companies around the world are in reasonable financial condition, having repaired their balance sheets with fresh equity.

‘Worries about the debt that need to be refinanced, both in the US and in the UK, are holding back some investors, but while there will be some big losers, there will also be winners,’ he said.

TR Property investment trust manager Chris Turner said demand for property has clearly re-emerged, largely down to the search for income but also as a stronger investment than bonds in an inflationary environment.

Returning demand

While macro events continue to haunt the global economy, he sees greater clarity on issues facing the property market – namely economic growth, unemployment, interest rates and leverage – putting things on a sounder footing than six months ago.