ABSTRACT
During the mid-1930s a boom in insurance company property investment occurred, the proportion of new insurance company funds directed to property rising to a peak of over 11 % in 1935. The contrast between insurance company property investment in the 1920s and the 1930s is striking; the average proportion of net new funds invested in this sector from 1923 to 1929 amounted to only 0.86%, compared to 7.38% for the years 1930-1937. Investment property constituted a virtually fixed-interest asset at this time, being subject to long leases at fixed rents, but offered a yield that was over 2% higher than that for consols. While mortgage finance constituted a substantial channelling of insurance company funds to productive investment it was, however, highly selective in the industries which received such finance due to the restrictions concerning what was regarded as acceptable security.
