The schemes are proving increasingly popular among investors looking for a source of long-term secure income.
Research by Knight Frank has now revealed the flow of funding into specialist property will increase to £15bn this year.
Shaun Roy, Head of Specialist property at Knight Frank said: “The growing appetite for long-term secure investments with good covenants amid the current uncertainty has intensified, which is driving the demand for specialist property.
“Investors now regard the granularity of the income derived within the specialist sectors as a positive rather than a threat, and a facet that improves its durability of income.
“The outlook for the coming year is positive and increased liquidity should draw particular attention to specialist assets.”
Income returns within the sector reached 5.7% in 2016 – exceeding the traditional commercial markets.
The main five specialist sectors are:
Healthcare: £6.3bn has been invested into Healthcare property over the last decade, 81% of the total investment has occurred over the last five years
Hotels: £3.4bn has been invested into Hotel assets, the second most transacted asset type amongst the specialist sectors in 2016
Automotive: The sector experienced the highest recorded investment in 2016 at £0.8bn, and is the only specialist sector to have seen volumes rise on an annual basis
Student Property: £3.1bn was transacted in Student Property in 2016 – the second highest recorded investment into the sector
PRS: £5bn was invested into the Private Rented Sector in 2016.