The impact of digitisation on asset classes such as office, retail and leisure space cannot be underestimated.
The sustained pivot to online shopping has triggered a demand in retail for warehousing and distribution centres. Retailers are also rethinking and reimagining their locations to downsize them and/or to repurpose them into micro-fulfilment hubs or completely different usages.
Hotel and leisure real estate, which relies heavily on international travel and corporate demand, is taking longer to recover from the pandemic’s impact. Businesses operating in these sectors need to think carefully about how to maximise their return on investment in property.
Capital allowances
Capital allowances are an effective way of reducing the after-tax cost of property expenditure. Typically, 95% of spend on new retail and leisure fit-outs can qualify for capital allowances. As shoppers return to the high street and retailers entice shoppers instore, careful consideration of capital allowances should be given when acquiring, building, fitting out or refurbishing property.