The Ediston Property Investment Trust is making a strategic move out of office space and into retail warehouses to capitalise on the changing habits of retailers and consumers.
The £300m UK commercial property Reit is not benchmark constrained, allowing manager Calum Bruce can invest across the spectrum which he says has led to a strategic shift out of offices and into the retail warehouse sector.
In the latest Portfolio Adviser video interview, Bruce explains why not all retail is equal and how he prefers out-of-town retail warehouses, saying they have “better attributes and prospects” than the other two areas: the high street and shopping centres.
This is because retail warehouses support the “omni-channel” retail strategies a lot of tenants have at the moment. This is a combination of “bricks and clicks” whereby shoppers the option to visit in person, as well as use click and collect, and online shopping services.
Bruce also plays down the pandemic-induced notion of the “death of the office” but he does think the way we interact with offices will change.
He argues changes will take longer to play out in office space than retail. This is because office tenants might have to wait for lease events such as breaks or expiries to gain a clearer picture on their future requirements whereas in the retail space, tenants can use insolvency procedures to quickly drop premises that they don’t need.
“There will definitely be an impact on the office market, but I don’t think it will be as severe as a number of commentators have predicted it to be.”
Elsewhere, Bruce talks about the prospects for the trust and the wider property sector looking ahead to 2022.
You can find other PA videos here.
