Considering the downturn in commercial property, lower rental returns and thus reduction in asset values, is 18.17% invested into commercial property too high?
Uniting Financial Services’ holding in commercial property is reasonably high, however is at a level acceptable to both the Asset and Liability Committee and the Uniting Financial Services Board. Uniting Financial Services is not an active trader of property and this property allocation makes up an important part of our Asset Allocation. Due to the financial market events of the past couple of years, like all asset classes, the Commercial Property market has gone through a period of revaluation. While there are pressures on this asset class at the moment, it still offers good cash flow and capital appreciation over a longer period of time and has a lower volatility impact on the balance sheet in comparison to the Listed Property Sector (REITS).
