The current average lease length for the fund is around 60 years which demonstrates long term stability and compares favourably to traditional commercial property funds with average lease lengths of around seven years.
More than 99% of the value of ground rents and between 70% and 80% of the long lease value comes from contractual rental income, which means the fund is protected from the full effect of movements in property prices. This makes TIME:Commercial Freehold far less volatile than most commercial property funds that are reliant on rent negotiations and capital value movements.
This stability and consistency was borne out in the immediate market shocks following the Brexit vote in June 2016. While UK property funds experienced an outflow of £1.4bn in the month of the referendum and many were forced to suspend , TIME:Commercial Freehold performed above its target, delivering secure, stable returns and continuous monthly liquidity for investors.
Today’s markets are uncertain and with political and economic events dominating the agenda, investors can expect conditions to remain unpredictable and volatile for the time being.
With stable, bond-like income so difficult to come by, the addition of a long income property investment has the potential make a real difference for investors seeking steady inflation beating returns.
TIME:Commercial Freehold key benefits
• Long term, steady and secure investor income - exceeded 4% pa since inception
• Portfolio diversification with over 47 properties on long leases averaging around 60 years
• Inflation protection for over 95% of freeholds
• Low volatility and no gearing
• Capital growth potential
• First open ended long income fund available to retail investors
• Access to an experienced team with proven track record
• Easy to invest via ISAs and personal pensions
Nigel Ashfield is managing director and partner of Time Investments