Filtered by Subscriptions: UK Commercial Property Use setting UK Commercial Property
Investment activity in September fell compared to August. However, not only did the £3.7bn total comfortably surpass the average figure for September in the previous 14 years, but it also brought the quarterly total to just over £12bn, 15% higher than the …
11th October 2017
The headline construction PMI fell back into contractionary territory, despite a relatively muted fall in the commercial sector. Even so, September’s commercial construction data suggests that rental values may fall next year, a conclusion that stands in …
3rd October 2017
Despite some reports of open-ended funds increasing their cash reserves, the data for net flows into such funds offer little support for the idea that investor sentiment towards commercial property has turned. … Is the tide turning for investor …
2nd October 2017
Net lending to commercial property contracted for a third consecutive month. While the fall was primarily down to standing investments, riskier development lending was in the red too. … Lending to commercial property …
29th September 2017
In contrast with the mixed signals on the economy, the post-referendum recovery in property markets has gathered momentum of late. Indeed, barring a sharp turnaround over the closing stages of 2017, the most recent monthly property data suggest that our …
27th September 2017
The jump in interest rate expectations and bond yields over the past week is consistent with our view that the MPC is poised to raise Bank Rate at its November meeting. And while higher rates will eventually be reflected in rising property yields, the …
21st September 2017
In contrast to the office and industrial sectors, retail investment activity has continued to contract. This seems consistent with a soft retail rental outlook which seems unlikely to change quickly. However, with valuations considerably less stretched, …
19th September 2017
Today’s Labour Force Survey data painted a healthy picture for occupier markets. July’s data posted the largest three-month increase in employment since December 2015, as well as another fall in the unemployment rate. That said, with nominal wage growth …
13th September 2017
After a very weak July, August’s 17%m/m increase in the value of commercial property investment activity is encouraging. Nevertheless, the market still appears to be dependent on large deals and overseas investor demand. … Commercial property investment …
12th September 2017
On past form, the latest agency data suggest that IPD office rental values are on the cusp of a fall of at least 10%. However, such an outcome is best treated as a downside risk as the fall in prime rents seems to have run a little too far relative to …
11th September 2017
In contrast to some forecasters who have suggested that the pound could reach parity with the euro before the end of the year, we expect sterling to reverse some of its recent losses against the euro. For a start, we don’t share other forecasters’ …
6th September 2017
Unlike the manufacturing sector, construction activity failed to rebound in August. And within the total, activity in the commercial sector contracted for the second consecutive month. Therefore, it seems as though the economy’s weak start to the year has …
4th September 2017
In August, IPF Consensus forecasts for total returns in 2017 were revised up for the fourth consecutive quarter, to stand at 6.7%. But the figures for 2018 and 2019 were left more or less unchanged. The Consensus is factoring in sub-5% returns, thanks to …
1st September 2017
Net lending to commercial property by banks and building societies fell by over £1bn in July, following June’s fall of £240mn. While this might reflect a more cautious approach by financial institutions, the £172mn rise in net lending to developments …
30th August 2017
Economic indicators have painted a mixed picture for a couple of months. For example, the composite PMI pointed to a slight pick-up in GDP growth at the start of the third quarter, to perhaps 0.4%q/q. Yet, healthy job creation and a further fall in the …
29th August 2017
June’s LFS made for some positive reading. Wage and employment growth rose and the unemployment rate edged down. But the bigger picture is that real incomes are still under pressure, which should weigh on retail property for some time yet. … Employment …
16th August 2017
Commercial property activity fell in both value and number terms in July. Yet this drop was not particularly alarming given the seasonality in the data. But most importantly, there is little indication that overseas investors – the main engine of recent …
14th August 2017
The latest data on both the economy and property markets have done little to change our outlook. One exception is the industrial sector where, on the back of healthy occupier demand, we have upgraded our forecasts. With the economy growing at a modest (if …
10th August 2017
The CIPS/Markit Construction PMI dropped significantly in July. And while we agree that rental value growth is likely to slow, we suspect that the latest commercial balance is overstating the risk of a fall in rents next year. … CIPS/Markit Construction …
2nd August 2017
Net lending to commercial property by banks and building societies fell by £239m in June. This meant that during the second quarter as a whole, net lending to property came in virtually flat, at minus £11m. … Lending to commercial property …
31st July 2017
Today’s RICS Commercial Survey showed that occupier and investment demand present a subdued outlook for office and retail property. However, the industrial sector looks poised to outperform the rest of the market. … RICS Commercial Property Market Survey …
27th July 2017
John Lewis’ announcement that it may utilise some store space to provide co-working office facilities is a reminder that department store tenant demand is soft. As such, while still high by past standards, we doubt that the yield gap between department …
25th July 2017
The fact that activity levels in both the leasing and investment markets has improved was encouraging. Both of these observations chime well with our view that the current, low but positive rates of capital value growth will be sustained over the coming …
21st July 2017
Today’s RICS Construction Survey for Q2 showed that private commercial and industrial construction activity reversed the gains made during the first quarter. … RICS Construction Market Survey …
20th July 2017
Unlike the rest of the commercial property market, rental value growth in the industrial sector has recently regained fresh momentum. There are also no signs that demand is set to ease, or that increased supply is doing more than keeping pace with that …
13th July 2017
Credit conditions in the residential mortgage market eased a touch in Q2. But with lenders’ risk appetites set to contract, Q3 may be a little tighter. Meanwhile, there is little evidence to suggest that credit conditions are shifting in the commercial …
The value of UK commercial property investment activity rose for the second month on the trot in June. But while encouraging, there are also good reasons to think that this is not the start of a much stronger trend. … Commercial property investment …
12th July 2017
May’s LFS survey was mixed. Job creation improved and the unemployment rate fell to another multi-decade low. However, the squeeze on real household incomes worsened. The implication is that the retail property sector is likely to suffer …
The dip in the commercial construction PMI in June only partially reversed the previous month’s rise. As such, it does not alter the impression that developers see little risk that the current softness in most occupier markets represents a major downside …
4th July 2017
Rising food prices are not a sign of growing pricing power for supermarket chains. Rather they are another sign of increased pressure on margins, implying that the unprecedented two-year decline in supermarket rental values almost certainly has further to …
30th June 2017
At £190m in May, net lending to the property sector more than reversed last month’s fall. Moreover, the broad-based nature of May’s improvement, along with lenders’ limited exposure to property assets, suggest that they are not unduly concerned about the …
29th June 2017
All in all, there was still little, if any, evidence to suggest that the Brexit process is having a major impact on property market sentiment or activity levels. And there was little to alter our view that rental value growth will drive muted, but …
23rd June 2017
Today’s labour market data were full of mixed signals. Job creation was healthy and consistent with gently rising rents at the all-property level. But, with the squeeze on real incomes intensifying, the prospects for retail property are less positive. … …
14th June 2017
After a subdued month in April, UK commercial property investment activity picked up in May. It was also encouraging that, at least in this months’ figures, there were tentative signs of improving liquidity. … Commercial property investment …
12th June 2017
It’s not hard to find bearish views on the prospects for UK commercial property. But neither real estate equity prices, nor equity market volatility provide compelling support for the bears. And with no sign of a recession or a surge in risk-free rates, …
8th June 2017
During the three quarters since the referendum, Rest of UK office rental values have done relatively little to counteract the yield-driven falls in capital values seen after the vote. However, survey evidence suggests that rental growth should turn more …
7th June 2017
Stock markets have shrugged off the uncertainty created by Brexit, with the FTSE 100 rising by 19% since the EU referendum last year. However, the key supports of the rally have now faded. First, the pound looks set to consolidate its recent gains, …
2nd June 2017
The Construction PMI for May provided a welcome surprise on the upside. And from a commercial property perspective, it provided the first indication that, in line with our view, rental value growth is likely to pick up in 2018. … CIPS/Markit Construction …
Net lending to the property sector fell slightly in April. Yet, this weakness probably reflects liquidity issues in the investment market rather increased risk aversion amongst lenders. It is also encouraging that traditional lenders’ exposure to the …
31st May 2017
For the third consecutive quarter, the consensus forecast for rental and capital value growth for the next two years rose, thus bringing them closer to our own. … IPF Consensus Forecasts …
26th May 2017
Even though investment activity looks soft compared to the elevated levels seen in 2015, the value of deals transacted over the last twelve months would not look too low compared to most other years. What’s more, current levels of investment are …
25th May 2017
Deloitte’s London Crane Survey, released today, highlighted that the size of the active pipeline fell slightly over the last six months. And while new developments continue to break ground, the demolition of dated buildings should help keep the size of …
17th May 2017
Generally speaking, the Labour Force Survey data painted positive picture for occupier demand. Yet, the ongoing squeeze on real incomes means that occupier demand for retail property will stay relatively weak for the foreseeable future. … Employment …
London’s office development pipeline has been a source of concern to many for some time now. But a comparison with vacancy rates supports our view that it has not been excessive. It also seems to be signalling that it will begin to be scaled back this …
16th May 2017
Last years’ dip in capital values will not be repeated in 2017. But with the economy unlikely to grow faster than its trend rate over the next year or two, rental growth will be modest and yields will mark time, leaving income as the primary driver of …
12th May 2017
Weaker investment market activity is fairly typical at this time of year. Even so, activity this April was particularly soft due to a very low number of deals. That said, there were no signs that overseas demand is slowing, or that Brexit concerns had …
11th May 2017
In contrast to yesterday’s commercial construction PMI, today’s RICS survey showed that construction activity picked up, rather than stagnated, in Q1. … RICS Construction Market Survey …
4th May 2017
Net lending to both the UK economy and property returned to positive territory in March. What’s more, with their exposure to the property sector at a 15-year low, traditional lenders are giving little signs of rising risk aversion. … Lending to commercial …
April’s rise in the CIPS/Markit Construction PMI chimed well with yesterday’s rise in manufacturing activity. That said, commercial construction activity was more subdued implying that development pipelines may no longer be expanding. … CIPS/Markit …
3rd May 2017
Previous periods of industrial outperformance have all marked the end of commercial property upturns. But there is no direct causality in this observed correlation. In any event, industrial occupier fundamentals look pretty good. Therefore, the current …
2nd May 2017
