Interactive Investor

The fund I’d like to own in 2020

The long-term fundamental case for this asset class remains intact, argues our head of funds research.

23rd January 2020 11:16

Dzmitry Lipski from interactive investor

The long-term fundamental case for this asset class remains intact, argues Dzmitry Lipski, head of funds research at interactive investor. 

[Filmed 18th December 2019]

For 2020, investors could consider BMO Commercial Property Trust (LSE:BCPT). The trust aims to provide an attractive level of income with capital growth from investing in a diversified portfolio of UK commercial properties.

The focus is on high quality, freehold and long leasehold properties based in prime locations with developed infrastructure and transport links. The trust has been managed by highly experienced property investor, Richard Kirby, who is supported by the wider, well-resourced team at BMO Real Estate Partners.

The trust mainly invests in three commercial property sectors, office, retail and industrial, with some exposure to the alternative sector including leisure, residential property and student housing. 

It is well-diversified by region and sector with a bias towards properties in the West End of London. Its largest assets include St Christopher Place Estate and office building in St James Street in London, and retail park space in Newbury and Solihull. 

The trust has produced consistent returns over the longer term and offers an attractive yield of over 5% and has generated an annual dividend since 2006. As we approach the Brexit deadline, at the end of January, any caution maybe an opportunity for investors to back UK property. 

And we still believe the closed-end fund structure is the most appropriate to access the liquid assets such as property. However, despite these challenges, the long-term fundamental case for property as an asset class remain intact.

Brexit's certainty will make UK Plc more attractive to international investors. Yields and valuations still look attractive relative to other asset classes, and property remains a solid option to generate income and diversify investors’ portfolios. 

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.