UK Commercial Property

Weak starts to limit construction after 2021

We think that delayed Central London office projects and new industrial starts will drive commercial construction output this year. But once the backlog of delayed projects has been exhausted, we think structural factors and high costs will deter developers from building new projects further out.
Prohad Khan Property Economist
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UK Commercial Property Update

Which assets can provide the best inflation protection?

Recent data have reinforced concerns about inflation risks in the UK. We remain of the view that property investments provide only limited long-term protection against higher prices, but of the individual asset types, we think industrial and residential are best placed to weather any surge. In view of the wider interest, we are also sending this UK Commercial Property Update to clients of our UK Housing Service.

14 January 2022

UK Commercial Property Data Response

Credit Conditions Survey (Q4 2021)

The Q4 credit conditions survey suggests that, while credit conditions will remain loose, scope for lenders to absorb further increases in interest rates into their margins has run out. Drop-In: Neil Shearing will host an online panel of our senior economists to answer your questions and update on macro and markets this Thursday, 13th January (11:00 ET/16:00 GMT). Register for the latest on everything from Omicron to the Fed to our key calls for 2022. Registration here.

13 January 2022

UK Commercial Property Update

Returns to cool significantly in 2022

The performance of commercial property exceeded expectations in 2021, with a particularly strong contribution from the industrial sector. But we don’t think that this momentum will last into this year, with high inflation and four interest rate hikes in 2022 expected to weigh on the outlook.

7 January 2022

More from Prohad Khan

UK Commercial Property Update

South East office rents still have further to fall

Although we expect the economic outlook will continue to improve, we think that South East office rents will still edge lower this year. What’s more, we don’t expect much of a rebound in 2022, as a shift to remote working will continue to weigh on demand.

7 July 2021

UK Commercial Property Data Response

Lending to commercial property (May.)

After falling sharply in April, net lending rose in May. We think this can be explained by the extension of payment holidays rather than an increase in new loans. Further ahead, we expect a weak recovery in investment activity and, as the economic recovery gathers pace, we think banks will be less willing to grant further forbearance, so net lending will turn negative again.

29 June 2021

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.

9 June 2021
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