The pandemic may prompt more investors to turn towards commercial property, Proplend has predicted.
The peer-to-peer property lender said that if rising prices lead to overinflation, commercial property – as both an asset and debt – is “an attractive alternative hedge”.
Uncertainty and stock market volatility may also drive new investors to the asset class, Proplend added.
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“For the foreseeable future, [while] we are in an…uber low interest rate environment, commercial property rental income and commercial property debt returns can both go part of the way to meet the demand for attractive rates for risk adjusted fixed income returns,” Proplend said in a blog post on its website.
“Commercial property as an asset class is not finished by any means, there will be obstacles to overcome and with those obstacles come opportunities.”
Proplend analysed how different industries will change and said that real estate may move from being an industry that sells a product, to one that delivers a service.
“And that means the dynamics of the market, and the industry, will undergo significant change, dislocation even,” the platform said.