INVESTORS are pouring millions of pounds into ever-more offbeat properties this year in the search for higher returns than residential buy-to-let.

A growing army of individual investors have been snapping up commercial premises on Britain’s high streets, including bank branches used by Barclays and HSBC, restaurant chains such as Pizza Express, and retail outlets such as Spar and Threshers.

A new Ebay-style online exchange, Propex, is even offering phone-mast sites — which are let back to mobile-phone firms — to investors seeking a novel way of making money from the property market.

Auction houses predicted last week that this will be a record year for commercial property as investors seek an alternative to the oversaturated residential market. Last year, they sold premises worth about £2 billion and Jones Lang LaSalle, one of the leading business-property auctioneers, said this year was shaping up to be even better.

The craze has been fuelled by eye-catching yields on commercial property, which can be as high as 10%, compared with only 3.6% on residential property after costs, according to IPD, a research firm.

Landlords can also let to blue-chip tenants on leases of up to 20 years, compared with a typical term of six months for residential tenants.

Investors get generous tax breaks on business property. Unlike residential property, it can be held in self-invested personal pensions (Sipps), which means the government gives you tax relief on the purchase price. And there may also be a lower rate of capital-gains tax than on traditional buy-to-lets.

Richard Auterac of Jones Lang LaSalle said: “Demand for commercial premises has reached unprecedented levels among individuals as they seek secure long-term tenants, rather than troublesome students who stick around for only a year.”

Don’t get carried away, though. A flood of buy-to-let investors pushed house prices to record levels a few years ago and deflated yields, and the same thing could happen in the commercial market.

Elliot Sorsky, 37, from Finchley, north London, is one investor who has switched from traditional buy-to-let to commercial property. His portfolio includes 10 mobile-phone masts, which he bought primarily for their high yields — the rental income as a proportion of price.

His most recent purchase, in Flintshire, North Wales, cost £74,500. The site was already let to Orange, the mobile-phone firm, and is guaranteed to pay an income of £5,500 a year — a yield of 7.25% after costs.

He said: “It gives me a great income stream because the rent is guaranteed until 2014.”

It is not only mobile-phone masts that offer juicy yields. Pubs, shops and offices can all be purchased at auction and often pay high returns.