Property Partner is set to give investors the opportunity to buy shares directly in commercial properties on its platform, the startup announced today.
The move will enable non-institutional investors to buy and sell shares in a range of commercial properties with the ability to target individual assets and sub-sectors, as well as being able to list shares for sale at any time.
“We started by revolutionising access to the residential property market. Now, it’s also clear to us that not enough people can access investments in commercial property in the way they’d like. We’re making it much easier for investors to access the attractive returns on offer in commercial property,” said Daniel Gandesha, CEO and founder of Property Partner.
“For most investors, the commercial property market has traditionally only been accessible through opaque, often illiquid open ended property funds, or listed property companies subject to stock market volatility. We’re doing away with this lack of transparency and access.”
According to the platform, UK commercial property investments have delivered an average annual total return of 8.9 per cent to investors over the past 20 years. Additionally, UK-based private investors account for only a 7 per cent market share, despite UK commercial property investments holding a market value of £486bn.
The new commercial department will be headed up by Xavier Pullen, former joint founder and board director at Capital & Regional PLC.
“We will target higher average yields than the major funds, along with the freedom to handpick your investments and list for sale whenever you like,” said Pullen.
“Commercial property is primarily valued on the income it can generate for an investor, with the strength of the lease and covenant of the tenant being key determinants of value. Our strategy will be to find varied investments across sectors that all have the strong tenant factor in common.”
Property Partner reached £100m AUM in December last year, which represents a fourfold growth since its launch in 2015. Over 10,000 investors have collectively purchased nearly 700 properties across the UK on the platform, achieving current estimated total annualised returns of 7.7 per cent.