Commercial real estate investment trusts have two potential tailwinds — a perceived inflation link and post-pandemic recovery. Hopes that these would boost UK Commercial Property Reit’s net asset value made it one of the best-performing investment trusts in January and culminated in its shares hitting a near-two-year high last week.
Selling retail and office properties and tilting further towards industrial assets with higher-returning development potential meant that the FTSE 250 constituent generated a net asset value total return of 8.7 per cent during the final three months of last year alone, ahead of the 7.9 per cent return posted by the UK Balanced Funds Monthly Index.
Nevertheless, UKCM is not the inflation hedge that some investors might think — only roughly 25 per cent
