Filtered by Subscriptions: UK Commercial Property Use setting UK Commercial Property
Lenders reported a small drop in credit availability to the residential sector in the first quarter of 2016, although they expect this to be temporary. Similarly, lenders are also displaying a degree of short-term caution in the commercial sector. … Bank …
13th April 2016
Our forecasts envisage that shopping centre rental growth will average less than 2%p.a. in 2016 and 2017. But those relatively subdued figures disguise a rather brighter outlook for prime shopping centres, which should deliver average rates of rental …
7th April 2016
Today’s commercial construction PMI data are consistent with our view that all-property rental growth is likely to slow during the remainder of 2016. However, itgives no indication that a rental correction is imminent. … CIPS/Markit Construction PMI …
4th April 2016
March’s Colliers/REC survey signalled that the survey’s respondents have become more cautious since December. And while we are in broad agreement about the direction of rental value growth, we think that yields will fall a little further this year, …
31st March 2016
Net lending to the property sector rose in February. Despite the sharp increase in net loans to standing investments, riskier development lending fell once more. That, together with the fact that banks and building societies’ exposure to the sector has …
Speculative industrial development rose significantly in 2015. But that needs to be balanced against healthy demand, low vacancy rates and limits to future pipelines. In turn, we expect all-industrial rental growth to average roughly 2%p.a. between 2016 …
24th March 2016
The economic indicators provided mixed messages this month. On the one hand, job creation is still healthy, inflation is low, nominal wage growth edged up and retail sales strengthened. Sentiment surveys, however, were less positive perhaps reflecting …
With the unemployment rate already low, it is perhaps unsurprising that the pace of job creation slowed in January. However, the picture is still supportive for occupier demand as high job vacancies suggest that employment should continue to rise for the …
16th March 2016
Hitting a 58-month low, investment activity surprised on the downside in February. While that could be signalling an imminent turning point for capital values, such an outcome does not seem consistent with the still-positive macroeconomic backdrop. …
14th March 2016
Property investment activity in February was weak. This may partially reflect fears about Brexit, but it is also in line with the expected moderation in activity from the very high levels seen in 2015 amid signs that the market is looking a little …
11th March 2016
An out vote in June’s EU referendum could trigger a sharp slide in sterling. But while that might push up prices, it is unlikely to raise interest rates or bond yields to levels that would prove disastrous for commercial property. Nor, to date, is there …
9th March 2016
By the end of 2015, at just under 50bps, the spread between leisure and all-retail yields was lower than at any point since 2007. With less exposure to structural oversupply risks than retail assets, and healthy occupier demand prospects, we expect the …
8th March 2016
Commercial construction activity in February fell for a second consecutive month. However, we think that recent weakness reflects some degree of normalisation, after a particularly strong fourth quarter, and is unlikely to result in a contraction in …
2nd March 2016
Overpricing is a more salient concern for London’s property markets than at the national level. However, there are cyclical and structural factors that currently support more aggressive pricing in the capital. Moreover, we have found little evidence to …
1st March 2016
Banks and building societies reduced their net loans to the commercial property sector in January. However, with banks and building societies’ exposure to commercial property holding fairly constant over recent months, we think that lending to property is …
29th February 2016
Compared to the Consensus, our forecasts are skewed towards the bullish end of the spectrum. However, given that we think that economic growth and occupier fundamentals will hold up well and that monetary conditions will stay accommodative for some time …
26th February 2016
The key economic indicators released this month highlighted that job creation and retail sales have been solid. Despite nominal wage growth softening further, near-zero inflation continues to boost real wages. However, the yield on 10-year gilts fell to …
25th February 2016
We think that recent fears about a global slowdown, and hence the reaction in financial markets, have been overdone. In fact, we expect global growth to accelerate this year and the prices of most commodities to recover, partly as a consequence of better …
19th February 2016
The turbulence in commodity and equity markets since the turn of the year has intensified concerns about the outlook for commercial property in the UK. And the longer the market dislocations persist, the greater the chances that they will spill over into …
Healthy job creation continues to bode well for occupier demand conditions. Moreover, with job vacancies high, it is likely that we will see further gains in employment this year, making a sharp slowdown in rental growth unlikely. … Employment …
17th February 2016
Commercial property transaction activity was muted in January. Encouragingly, however, sentiment towards UK property seems healthy. And if we are correct about the UK’s positive macroeconomic fundamentals, it is unlikely that we will see a collapse in …
12th February 2016
Last month’s jump in commercial property construction activity was more than fully reversed in January. While market turmoil and the spectre of the EU referendum may be holding back some commercial construction, supply shortages and robust rental growth …
2nd February 2016
In net terms, banks and building societies boosted their loans to the commercial property sector in December. However, the increase in net lending applied only standing investments, not new development, implying that lenders are still cautious. … …
1st February 2016
The recovery in rental value growth has continued to plateau. This, however, does not imply that rents are due to correct as the positive economic outlook and supply shortages should underpin rental values. With yield impact fading, capital value growth …
27th January 2016
The RICS commercial property survey reported that occupier demand moderated but remained positive in the fourth quarter. Yet even if the dip in demand is sustained, supply shortages are likely to support rental value growth for some time. … RICS …
26th January 2016
The recent slump in real estate equity prices appears to be signalling that a 6% fall in all-property capital values could be in store for H1 2016. However, we are confident that job creation and muted inflationary pressures will underpin our …
22nd January 2016
Jobs numbers continue to point to improving occupier demand. That said, the regional breakdown of employment is uneven and it suggests that occupier markets and rents in the North West look well-placed to outperform. … Employment …
20th January 2016
Despite a fall in construction activity in the fourth quarter, workload balances in the commercial sector are solid. Expected work balances, which are above the survey’s average, combined with the UK’s fairly healthy growth and employment prospects, imply …
14th January 2016
Commercial property investment in December was subdued. This is in line with our view that the most vigorous rates of activity probably now lie behind us. However, with a benign rate outlook and further economic growth and job creation expected, …
The turn of the year has brought with it renewed uncertainty around the prospects for the UK and the world economy and we have nudged down our UK economic growth forecasts as a result. But the domestic economy and labour market should hold up well so that …
12th January 2016
Last month’s jump in activity in the commercial property sector helped to reverse November’s dip in overall construction activity and suggests that the supply pipeline is continuing to grow. Yet the improvement is coming off a low base and the risks of a …
5th January 2016
The deleveraging process within the commercial property lending market showed no signs of abating in November. In fact, the stock of outstanding debt to commercial property fell by almost £1bn during the month. … Lending to commercial property …
4th January 2016
The upswing in the rental recovery seems to be close to its peak. This, however, does not imply that rents are set to correct as the positive economic outlook should continue to underpin rental growth. With yield impact fading, capital value growth is …
23rd December 2015
Combining a simple assessment of relative yields with the outlook for job creation, and thus occupier demand, suggests that Leeds and Bristol are the two non-London markets with the most upside potential for capital value growth. … Where are capital …
18th December 2015
Today’s jobs numbers surprised on the upside, implying that after a summer lull occupier market conditions are improving once more. However, the sectoral breakdown suggests that job creation has been uneven and office space has been the main …
16th December 2015
Experience shows that there is little direct relationship between all-property yields and Bank Rate. And with little prospect of a marked deterioration in occupier market conditions, next years’ increases in Bank Rate are unlikely to trigger a property …
15th December 2015
October’s surprise jump in UK commercial property investment was not sustained. The value of investment fell markedly in November and is likely to continue on a downward trend as investor demand returns to more normal levels. … Commercial property …
11th December 2015
December’s Colliers/REC pricing survey signalled that, with the gap between prime and secondary yields narrowing, the survey’s respondents have become more selective in terms of sector and location. That said, the survey highlights that while we are in …
4th December 2015
At a glance, November’s Construction PMI provided few positives for commercial development activity. However, with reports of falling availability, and rents still rising, it is likely that the deterioration in development will be short-lived. … …
2nd December 2015
Lending to commercial property in net terms contracted in October, in line with lending to the economy as a whole. Indeed, banks’ exposure to the sector continues to fall, with lending to development and standing investments both receding last month. … …
30th November 2015
Our forecasts put us towards the high end of the current Consensus. However, given our view that productivity will deliver a positive surprise, helping to keep interest rates and property yields low, that is a position we are happy to hold. … IPF …
27th November 2015
With little additional detail on business rates, and the Starter Homes Initiative simply a restatement of a policy announced last year, Help to Buy London and the Chancellor’s latest assault on BTL landlords are likely to be the main talking points of …
25th November 2015
The upswing in the rental recovery continues to gather pace. But, offsetting this, the contribution of yield impact is steadily falling and capital value growth slowing. With little to suggest an imminent rise in UK interest rates, we see little scope for …
24th November 2015
The strength in headline retail sales volumes is at odds with shopping centres’ poor rental performance. This is due to the fact that sales of items that form the core of shopping centres’ offering have underperformed. Excluding such items suggests that …
19th November 2015
The commercial property market seems to be at a point of transition, which will be characterised by yield-driven gains in capital values giving way to capital value growth that is driven largely, if not solely, by rental values. The result will be a …
18th November 2015
Financial markets still do not expect interest rates to rise until the end of 2016. While we agree that interest rates will rise very slowly, we expect the first rise to come sooner, probably in the middle of next year. After all, the MPC’s Inflation …
17th November 2015
Construction in London rose sharply over the last six months. That said, fears about oversupply in London’s office market overlook the fact that completions do not deliver a one-for-one rise in stock. … London’s growing office pipeline not (yet) a cause …
12th November 2015
Today’s jobs numbers were slightly higher than we had expected implying that occupier market conditions are still healthy. Indeed, today’s jobs numbers are broadly consistent with our rental growth expectations of around 3.8%y/y. … Employment …
11th November 2015
Commercial property investment rose significantly in October ending three consecutive months of declines. However, it is unlikely that this spike in investment will continue in the months ahead as the latest data were skewed by a few large deals in …
9th November 2015
The RICS commercial property survey highlights that supply is responding to occupier market conditions. Yet new supply will take time to deliver a material change in availability. Meanwhile, rents are likely to remain on a rising trajectory. … RICS …
3rd November 2015
