Large Portfolio landlords set to defy economic gloom and boost portfolios

Large Portfolio landlords set to defy economic gloom and boost portfolios

0:02 AM, 24th May 2023, About 11 months ago

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Professional landlords look set to seize opportunities in the property sector despite the tough economic background with plans to expand their portfolios, research reveals.

Handelsbanken says that more than half of large portfolio professional landlords (57%) are gearing up to acquire at least one new asset in the coming year.

And nearly two-thirds (60%) are targeting new regions, proving they’re not afraid to take risks and seek out new investment opportunities.

But these investors aren’t just looking to snap up more properties – they’re also branching out into new sectors, with offices being the most attractive (43%) as investors hope to capitalise on depressed valuations.

‘Commercial property values saw a major correction’

James Sproule, Handelsbanken’s chief economist, said: “Commercial property values saw a major correction in the second half of 2022 as a direct impact of the higher interest rate environment.

“Average retail property prices were down by 15%, office prices were also down by 15%, and industrial unit prices were down by 25%.”

He added: “In addition, there are the ongoing considerations around post-pandemic working practices and retailing habits which, until they are more settled, will be weighing on commercial property valuations.”

Landlords expect their portfolio value to increase

The bank’s survey also highlights that a whopping 92% of those landlords expect their portfolio value to increase over the next year.

And 39% of landlords are predicting growth of more than 20%.

According to the Professional Landlords Survey, London takes the top spot as the most desirable region for property investment, with 27% of investors eyeing it as their target.

The South East is hot on the capital’s heels, with 26% of respondents keen to invest in this area.

But it’s bad news for Yorkshire and the Humber, and the West Midlands, as both regions are struggling to attract investment, with only 9% interest from the surveyed landlords.

The table below shows how professional property investors rate the attractiveness of regions across the country.


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