UK Commercial Property Update What does the investment market have in store in 2017? Investment activity fell to more normal levels in 2016 and we expect 2017 to at least match it. Not only have relative yield movements made the UK look more attractive, but the economy has surprised... 17th January 2017 · 1 min read
UK Commercial Property Update Three key risks to UK commercial property in 2017 In our view, 2017 will prove to be a better year for property than the consensus assumes. But there is little room for complacency. A domestic-led inflationary shock, well beyond what central banks... 6th January 2017 · 1 min read
UK Commercial Property Update Could the IPD figures be underestimating capital value falls? A recent report argued that the fall in all-property capital values in the third quarter may have been double the one presented in the IPD quarterly index. Yet the same methodology implies that the... 13th December 2016 · 1 min read
UK Commercial Property Update Construction starts to slow Commercial construction activity faces several headwinds, such as subdued occupier market conditions as well as rising costs. However, if developers believe (as we do) that the economy will recover... 9th December 2016 · 1 min read
UK Commercial Property Update Could retail warehouse rents provide a positive surprise? The fact that real rental values are 22% below their previous peak and housing transactions are set to strengthen, suggest that retail warehouse rental values have substantial scope to rise. However... 25th November 2016 · 1 min read
UK Commercial Property Update Will the bond sell-off push property yields higher? The recent surge in gilt yields has reversed much of the widening in the property-to-gilt spread seen after the referendum. Yet, at 390bp, the gap between the all-property yield and gilts is still... 18th November 2016 · 1 min read
UK Commercial Property Update Headline supply overstates the risk to London office rents The size of London’s active pipeline has risen slightly since May. More supply poses a risk to rental values. However, the likelihood of a rental correction depends on both the net increase in supply... 15th November 2016 · 1 min read
UK Commercial Property Update What is driving overseas demand for UK property? The widely held view that the drop in the pound is the primary factor propping up demand for UK property among overseas buyers is not wrong – but it is too simplistic. The fall in sterling will have... 21st October 2016 · 1 min read
UK Commercial Property Update Is falling floor space per worker always a risk to availability? If permanent, the trend towards higher density occupation in London’s office market points to an increased risk of oversupply arising from new construction. Yet at the same time, that trend should... 14th October 2016 · 1 min read
UK Commercial Property Update What can we infer about regional prospects from equities? Based on past form, equity prices point to an adjustment in all-property capital values of around 11%in the London, and 13% in the non-London markets. However, with the economy looking to be on a... 7th October 2016 · 1 min read
UK Commercial Property Update How big are the risks for Edinburgh and Glasgow offices? With employment growth set to slow, the rental outlook in the main Scottish office markets is muted. Encouragingly, however, office property pricing in Edinburgh and Glasgow is considerably less... 28th September 2016 · 1 min read
UK Commercial Property Update Was the uptick in industrial yields unwarranted? Forward-looking aspects of industrial and manufacturing surveys have acted as a fair lead indicatorfor industrial yield movements three and six months ahead. And, with the initial post-referendumshock... 22nd September 2016 · 1 min read
UK Commercial Property Update What does sterling’s fall mean for hotels and central London retail? Some commentators have touted the recent fall in sterling as a ray of light for hotels and central London retail. However, we think that any uplift to occupier markets will be modest, as the... 30th August 2016 · 1 min read
UK Commercial Property Update What can financial market volatility tell us about pricing? Equity market volatility can be a proxy for economic uncertainty which, in turn, should anticipate movements in all-property yields. This relationship suggests that, given the heightened uncertainty... 16th August 2016 · 1 min read
UK Commercial Property Update How vulnerable are rents to an economic downturn? Relative to their past peaks and underlying trends, rents are only worryingly high in London’s retail market. While that would not prevent large falls if the economy were to suffer a full-blown... 12th August 2016 · 1 min read
UK Commercial Property Update Could monetary policy prop up capital values? As expected, the MPC today voted to cut Bank Rate by 25bps to 0.25% and to restart its asset purchase programme. This should underpin the recent movements in sterling, gilt yields, and equities, and... 4th August 2016 · 1 min read
