Arthur Online investigates the recent downward trends in commercial property, but will it last?
According to a report by Savills – the international property agents and advisors – volumes of commercial property investment in the UK were down for the first quarter of the year. Though they also suggest that the underlying trend is up when compared to the long term average.
Savills independent commercial property experts have analysed the figures for this year in comparison with previous years and are satisfied that there’s a 9% – 14% increase in the ten year average for investment volumes, despite this year being 11.6% down on 2017.
Current low inflation rates, combined with low unemployment, may also be a contributing factor in the return of confidence to the market – in particular the retail sector – according to director Matt Oakley and the team at Savills. He suggested:
“With consumer confidence returning… and a substantial group of investors active in the market, future quarters should be healthier. In particular, as ‘town centre dominant’ shopping centres are now yielding above 7.5%, we expect to see more opportunistic investors swooping this sector, with an estimated £900 million of shopping centres currently under offer.”
This sentiment was echoed by Matt Ridley – Savills UK and Europe CEO – when he said:
“… the first quarter of 2018 is broadly in line with previous healthy years and we expect activity to pick up over the course of the year as underlying fundamentals improve.”
All of which suggests that the market for commercial property in the UK is going through a sustained period of long term growth, despite the first quarter this year being down on 2017 and previous record years
Commercial Property Management
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