UK Commercial Property

UK Commercial Property

UK Commercial Property Update

UK Commercial Property Update

Should investors be worried about higher inflation?

Recent strong inflation data have heightened concerns about global price pressures. At present, we think there will be limited impact on short-term property performance. Further out though, higher inflation expectations reinforce the view that bond yields will rise, which will eventually drag on returns.

In view of wider interest, we are also sending this publication to clients subscribed to our US and European Commercial Property Services.

16 June 2021

UK Commercial Property Update

Economic tailwinds not enough for a retail revival

Upbeat economic data suggest that consumers have been flocking back to the shops since the reopening of non-essential retail in April. But this is probably not enough to turn around the fortunes of a troubled sector yet. After all, the strong bounce in demand that we expect over the rest of the year will benefit physical shops proportionately less, while the sector also faces a backlog of rental arrears.

14 June 2021

UK Commercial Property Update

Are green commercial leases the future?

With emission targets needing to be met by 2030, the race is on for the real estate sector to decarbonise. By forcing tenants and landlords to share the risks, benefits and costs of environmental policies, green commercial leases are a promising tool, and widespread adoption seems likely. That said, we don’t expect a significant impact on commercial property performance yet.

In the view of wider interest, we are also sending this publication to clients subscribed to our US and UK Commercial Property Services.

10 June 2021
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UK Commercial Property Update

Can urban logistics fill the void in cities?

The acceleration of structural shifts is likely to result in some conversion of retail and to a lesser extent office space to urban logistics use. However, we think these conversions will be relatively limited given the significant shortfall in values between existing uses and industrial.

UK Commercial Property Update

Homeworking brings more pain for city retail

Retail has been the hardest hit of the major sectors during the pandemic, though hope is returning with the re-opening of economies. But new challenges are emerging. In particular, we think that more home working will divert (already-weak) instore retail demand away from city centres in future.

UK Commercial Property Update

In which cities will WFH have a larger impact?

More working from home will inevitably change cities as we know them. However, cities are more than just workers. This means that cities where a higher share of jobs can be done remotely are not necessarily the ones where the impact of remote working on the city’s real estate is likely to be the greatest.

5 May 2021

UK Commercial Property Update

Slow but steady recovery for investment activity

After a 20% y/y fall in 2020, we think the economic recovery in H2 and some pent-up demand will support an improvement in investment activity this year. Though we estimate that totals will rise by 25% y/y to £50bn this year, this would still make it a weak year by recent standards.

UK Commercial Property Update

Limited recovery in property lending this year

Although last year probably marked a low point for lending towards commercial property, we expect the recovery will be subdued this year. After all, lenders have indicated that the availability of credit will remain weak in the coming months and a slow recovery in investment activity will weigh on the demand for new loans.

23 April 2021
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