Distressed commercial property 'attractive at the right price'

Distressed commercial property could be of interest to investors if it is available at the correct price, according to an expert.

Michael Rhydderch, a partner at Cushman & Wakefield, has claimed that while it is generally true that the poor assets "tend to perform worst in downturns", some can occasionally emerge as opportunities.

However, he added that this does not spell good news for the current holders of such properties.

"The problem about that [right] price is that, because new lending is restricted and is generally restricted to prime assets, there is little debt available for secondary and tertiary assets. All that means is that their price has to fall that much further for them to attract bids," he explained.

Recent figures from the Royal Institution of Chartered Surveyors found that over 75 per cent of respondents to its latest global poll reported that more distressed assets came to the market in the second quarter of 2009 compared to the first.