The excitement around AI has pushed a lot of money into a small corner of the market. That’s great when it works, but history and market movements in the past few weeks remind us that even the strongest themes can wobble.
Property, on the other hand, has tended to chug along steadily in the background, quietly delivering a growing income and, at times, surprisingly strong returns.
Here are six charts from our latest update that show why UK listed property can sit neatly alongside AI-driven equity exposure.
1. When tech stumbled, property stepped up
This chart looks back to the dotcom era. As the NASDAQ fell more than 60%, UK property shares rose around the same amount. It’s a simple reminder that different parts of the market can move in very different ways, and that steady rental income behaves nothing like high-growth tech.
2. UK REITs are trading at unusually wide discounts
UK REITs remain at deep discounts to their net asset values. The last reported market discount was -31% compared with a 10-year average of -18.7%. For long-term investors, this creates an entry point that doesn’t rely on perfection or momentum. Discounts of this size have historically been followed by strong one- and two-year returns.
3. Megatrend real estate is also cheap
Even areas supported by long-term themes — such as aging population, digital infrastructure, generation rent and urbanisation — are trading at discounts. These aren’t speculative corners of the market. They’re businesses with stable tenants and predictable cashflows, yet they’re valued as if the world is still in the middle of a rate shock.
4. Property yields remain attractive and stable
Prime property yields have held firm and, in some cases, started to compress again. Against the c.1% yield on index-linked gilts, listed property’s c.5% dividend yield stands out. For anyone funding long-term liabilities, that level of income is hard to ignore.
5. The M&A market is telling its own story
While retail investors have been sitting on the sidelines. private equity and corporates have been buying UK listed property at pace.
6. A different way to play the AI boom: digital infrastructure
Investors often think of AI as purely a software or semiconductor story, but the physical backbone matters just as much. Data centres are essential for AI to function and several UK REITs are directly involved in this build-out. Some names in the market have already taken meaningful steps into data centres, yet share prices haven’t really caught up with the scale of the opportunity. It’s a way to tap into AI’s growth without relying on the crowded parts of the tech sector.
The takeaway for investors
AI is an exciting theme, but it isn’t a risk-free one. Pairing high-growth technology exposure with undervalued, income-producing property is a straightforward way to diversify. The TM Gravis UK Listed Property Fund focuses on UK REITs backed by long-term structural trends — including the digital infrastructure needed to power the AI future.
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The information contained in this article is issued by Gravis Advisory Limited (“GAL” or the “Firm”)), which is authorised and regulated by the Financial Conduct Authority. GAL’s registered office address is 24 Savile Row, London, United Kingdom, W1S 2ES. The company is registered in England and Wales under registration number 09910124.
TM Gravis UK Listed Property (PAIF) Fund (the “Fund”) is a sub-fund of TM Gravis Real Assets ICVC, which is a non-UCITS retail scheme and an umbrella company for the purposes of the OEIC Regulations. The Fund is a Property Authorised Investment Fund (“PAIF”).
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