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Beyond the high-street: where to invest in commercial property in 2021

The high-street retail property sector, a traditional focus for commercial property investment,  is struggling. So, where can investors look for attractive deals in 2021 and beyond?

The high-street retail property sector has been one of the hardest hit markets over the last year or so as consumers have been forced to stay at home and shop doors have had to close. Conditions are set to improve as city centres gradually reopen but the recovery of this sector is far from certain.

As a result, at the moment, there has been little for investors to get excited about in this space. However, that’s not say that retail property doesn’t hold any opportunities. Online shopping has boomed since the beginning of the pandemic and the demand for warehousing and logistics spaces has grown accordingly. As such, good returns are available here.

Another retail property sector offering attractive returns is supermarkets. The ability of these stores to remain open during the pandemic and their expansion into the e-commerce and home delivery spaces have led to strong results.

Non-retail property that investors are targeting

Outside of retail, another market that investors are targeting is medical properties, including private hospitals and care homes, as well as mental health and children’s services. A key factor here is the continued ageing of the population profile and the infrastructure demands related to this trend.

Another bright market is student accommodation, which has shown notable resilience over the past 12 months. Initially expected to take a hard hit in the wake of the outbreak of COVID-19, the sector has resisted such a slump and is continuing to offer good investment deals.

New investment potential for high-street retail property?

Surveying the commercial investment property landscape, it is clear that non-traditional sectors are to the fore, offering opportunities for good returns. However, it would be unwise to right off traditional markets, even high-street retail property.

How changes to consumer purchasing behaviour impact the high-street retail property sector remain to be seen. What is set to have a much larger impact, in the short-term at least, is a recent change to planning laws that allows property owners to turn retail space into flats and leisure facilities. This has the potential to open up a lot of new opportunities in this space.

Commercial property investment finance options

The commercial investment property market has undergone such significant changes since 2020 and the landscape is still shifting. At a time when the country is coming out of lockdown and market momentum is building, it is essential to keep a close eye on developments.

It is also vital to have access to the right finance facilities. In a market where opportunities are appearing in non-traditional sectors and where action needs to be decisive and quick, flexibility is crucial. This is why you need to ensure that your commercial loan and mortgage lender provides access to all the available funding options, including the services of alternative lenders.

To find out more about A&T Business Associates services for commercial property investors, contact Tony Hedger on 01903 602211 or tony.hedger@atbusinessassociates.co.uk.

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