UK - Aberdeen Property Investors is urging schemes to increase property allocations and predicts they will return approximately 7.8% per annum over the next 30 years.
The Investment Property Databank said property has been the best-performing asset class over the past decade, returning 11.5% compared to the 6.6% posted by equities.
Providing yields remain unchanged going forward, it predicts that returns will be similar to the current property yield of 6.3% plus income growth of 2.5%, net of depreciation and costs.
Chief executive David Hunter said: “This performance, coupled with relatively low volatility and diversification attributes, more than justifies property’s place in a multi-asset investment portfolio.”
He added that schemes are increasingly turning to this asset class because of property’s strong long-term performance and trustees’ needs to ensure that solvency can be covered and future payouts sustained as funds mature.
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