Investors in the swim
with pooled commercial property investments

Over the last five years, we have brought to Estate owners’ attention the benefits of investing in commercial property. These include: a relatively high return; minimal costs of ownership (tenants are usually liable for the cost of repairs and insurance); the ability to borrow money against the assets being acquired; and a reliable cash flow, assuming that the tenant is of a reasonable covenant and trading successfully.

Recently more and more investors have been moving into this sector and the consequence has been a significant increase in prices and a lower return on the capital invested -- to such an extent that we have found it difficult to find suitable property purchases for our private clients to acquire.

The alternative for private investors is to invest in a pooled scheme. The advantages of pooled schemes include a lower financial entry threshold, a wider spread of risk across a portfolio and a greater diversity both by sector and location. Pooled schemes also offer professional asset management and usually offer tax transparency, through the use of Scottish Limited Partnerships

CKD Galbraith is the appointed property manager for two such schemes: the Private Property Fund, which will, once fully invested, have a portfolio value of circa £40 million; and the Dundas Commercial Property Fund I which will have a portfolio valued at approximately £10 million.

We have also been appointed as the property managers to the new Dundas Commercial Property Fund II, which is currently being launched and is anticipated will have a portfolio value of between £20 million and £40 million, depending on the level of subscription. The fund will invest in high yielding property requiring active asset management.

Other commercial property successes
Our commercial property department has been very busy in recent weeks on behalf of several clients, and we are pleased to have concluded two major property sales.

The first is the sale of New Kirkgate shopping centre in Edinburgh to GE Capital, an American financial services provider. Allied London Properties (ALP) bought the centre six years ago for just over £5 million and made a considerable investment -- about £4 million -- to completely refurbish the centre and improve its facilities. The sale figure was in excess of £15 million. CKD Galbraith was responsible for the asset and project management of the centre throughout the period of ALP's ownership. We continue to work with ALP on its Scottish assets.

CKD Galbraith has also acted as joint agents in the sale of a portfolio of six buildings at Teesdale Business Park, Stockton-on-Tees this month, on behalf of Cheviot Investments Limited. The buildings were acquired by Tiger Developments, an Irish property development company, for £13.5 million.

Cheviot Investments has benefited from ownership of the property over the past four years as a high-yield investment, under CKD Galbraith’s management.

We continue to manage Cheviot Investments’ substantial commercial property portfolio in Scotland and the north-east of England.

For more information on commercial property sales, lettings or investment opportunities, please contact our commercial department on email: commercial@ckdgalbraith.co.uk or telephone: 0131 556 4422.

An Invitation: CKD Galbraith celebrates its first anniversary

We cordially invite you to join us and would ask you to respond to Irene Thomson, in CKD Galbraith’s Perth office, if you are able to attend.

Please RSVP by 12th April to irene.thomson@ckdgalbraith.co.uk or telephone 01738 451111.

Date: Thursday 22 April 2004
Time: 6pm – 9pm
Venue: The Merchants’ Hall, Hanover St, Edinburgh

Directions:
The Merchant's Hall is located on Hanover Street between Princes Street and George Street, next to the Clydesdale Bank. The Hall is only a 5-minute walk from Edinburgh's main train or bus stations. GET DIRECTIONS AND MAP FROM MULTIMAP.

To read previous newsletters from CKD Galbraith please click here.

A New Force in Property

CKD Galbraith is a new property consultancy formed through the merger of CKD Finlayson Hughes and Cluttons (Scotland).

The consultancy specialises in serving the needs of private clients. With offices in Edinburgh, Glasgow, Perth, Aberfeldy, Inverness, Ayr and London, our partnership provides the full range of property consulting services across the commercial, residential and rural sectors throughout Scotland. The combined knowledge, expertise and experience of CKD Finlayson Hughes and Cluttons (Scotland) both firms – each enjoying long-established reputations for quality service – has created a national partnership with unrivalled local knowledge.

Services include:

• Sourcing properties
• Surveys
• Appraising and valuing
• Negotiating purchases on the best possible terms
• Residential Property
• Commercial Property
• Forestry Property

For more information please visit www.ckdgalbraith.co.uk