Property Now Best Performing UK Asset Class

March 12, 2001 ( - Real estate is now the best performing UK asset class over both one year and three years following the equity market tumble last year, according to property specialist Investment Property Databank's (IPD) annual figures.

For the three years ending in 2000, UK property returns averaged 12.2% compared to 9.8% for equities and 9.6% for gilts, according to Investment and Pensions Europe.

As a sector UK pension funds recorded property returns of 10.3% last year, accounting for nearly a quarter (23%) of the whole property market.

IPD’s figures are based on 13,260 UK properties valued at £97.4bn (?153bn).

Last year also saw a major switch from investments in retail property to office space, with the latter accounting for 46% of investments, most in Outer London and Southern England. Retail property investment slipped to 32% from 61% in 1999, while industrials maintained a market share of 17%.

– Nevin Adams