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Ignis says commercial property will deliver a blockbuster 11.5% in 2014

Ignis says commercial property will deliver a blockbuster 11.5% in 2014

The UK commercial property market will rise by 11.5% in 2014, more than 2% higher than expected, according to forecasts from the Ignis property team.

While the most recent Investment Property Forum Consensus Forecast predicted an average total return of 9.3% this year, the team think the actual figure will be higher, 'driven by a broadly broadly equal combination of income return and capital growth'.

But George Shaw (pictured), manager of the £1.1 billion Ignis UK Property fund, argued that this rally in the market will not result in a property bubble. 

He acknowledged concerns there would be a return to over-inflated property prices like those seen in 2007, but suggested 'yields can sustain a moderate re-rating over 2014, without moving into bubble territory' as average capital values are currently 30% less than before the crash.

Over one year to November 30, the Ignis Commercial Property fund returned 5.6%, compared to a 4.7% average for the IMA UK Property sector, making it third quartile, albeit in a peer group distorted by property shares funds. Over three years to November 30, it returned 10.2% compared to a sector average of 8%, making it second quartile.

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Profile: The opportunity set that attracted Brett Williams to wealth management

Profile: The opportunity set that attracted Brett Williams to wealth management

Brett Williams is best known for helping to build some of the biggest platforms in the IFA market.He made the move over to wealth management to head SEI’s UK business earlier this year in the belief that this is where the best opportunities now lie.

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