Investec: UK property professionals earmark residential sector

31 January 2011

Property professionals earmark residential sector for best investment opportunities in 2011

UK property professionals expect the residential sector to offer the biggest investment opportunities in the next 12 months, according to a new study(1) by Investec Specialist Private Bank’s <a href="http://www.investecspb.co.uk/home/lending_and_financing/property_finance.html">Structured Property Finance</a> division.

The retail and leisure sectors are ranked joint second in the study, followed by the office and then industrial sectors.

Ranking according to attractiveness for investment in next 12 months Sector

1st Residential

2nd = Retail

2nd = Leisure

4th Office

5th Industrial

Source: Investec, December 2010

The study also reveals that around half (49%) of those surveyed expect UK residential property valuations to fall over the next 12 months while a third (34%) believe they will stabilise. Only 13% believe they will increase. Of those who believe they will go down, nearly three quarters (72%) anticipate a fall of up to 5%. Nearly a quarter (24%), however, believe they will fall by between 6% and 10%.

Expectations for yields are more varied with a third (33%) of property professionals expecting them to increase, a quarter (25%) forecasting that they will remain the same and 14% expecting them to decrease over the next 12 months. A further 8% expect to see an initial decrease followed by an increase, while 4% anticipate the reverse of this.

Gary Dobson of Investec’s Structured Property Finance division comments: “Residential property values in the UK remain depressed compared to their peak and it seems likely that in many areas of the country they will continue to fall during 2011. This should create some great opportunities for investors as they take advantage of low valuations and higher yields.

“We believe this year will offer strong lending opportunities to both new and existing clients and we’re expecting to meet a much higher level of demand to support development projects than in recent years.”

- ends –

Notes to editors

1 Research conducted amongst 146 senior UK property professionals in December 2010

ArticleSource: ArticlesAlley.com

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Investec Specialist Private Bank provides a range of senior debt, mezzanine debt and equity solutions to assist clients who are active in either residential or commercial property acquisitions. Typically there is a maximum exit strategy of three years for mezzanine and equity funding, whereas senior debt can be provided for longer terms. This enables clients to purchase or re-finance commercial investment properties, build new or refurbish existing residential properties, as well as create property investment portfolios that require unconventional gearing or mezzanine / equity finance. Investec Specialist Private Bank has developed a real affinity with the entrepreneurial class and our experience places us right at the heart of this unique business community. We have created an environment that helps make things happen: propelled by a successful track record and market-leading expertise. Our areas of specialisation include Structured Property Finance, Banking Services, Specialised Lending, Wealth Management, Trust and Fiduciary services, and Growth & Acquisition Finance. Investec Specialist Private Bank is a division of Investec Bank plc, which is authorised and regulated by the Financial Services Authority and is a member of the London Stock Exchange. This press release is issued on behalf of Investec Bank plc. Registered address: 2 Gresham Street, London, EC2V 7QP. (Reg No. 489604) To find out more about Investec Specialist Private Bank’s range of products and services, please log onto www.investecspb.co.uk

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Investec: UK property professionals earmark residential sector