Despite the price of commercial property having fallen in recent months, many pension fund managers are keeping faith in the sector.
A joint report by the Pensions Management Institute and the property investment arm of Prudential, PRUPIM, has found that 25 per cent of pension fund managers were planning to increase there asset allocation to commercial property.
Professor Paul McNamara, director and head of research at PRUPIM said: “Given the difficult times in the commercial property market over the past year, this is a welcome vote of confidence from institutional investors.”
Vince Linnane, the CEO of the Pensions Management Institute added: “We hope the findings help advance understanding amongst all UK pensions schemes on the key trends emerging in real estate investment and related exposure.”
As well as the 25 per cent who planned to increase there commercial property portfolios, 50 per cent said they would be maintaining the current level they are investing in for the medium-term.
Despite the optimism, the commercial sector has seen huge declines in recent weeks, with the owners of the London offices of Canary Wharf, Songbird, noting huge losses.