Filtered by Subscriptions: UK Commercial Property Use setting UK Commercial Property
With the contribution of rental growth and yield compression fading, capital value growth is expected to moderate further. Yet, with economic and employment growth set to be solid, and interest rates low, rents and capital values are unlikely to correct …
23rd June 2016
Leisure rental value growth has slowed dramatically since December. However, over the medium term, muted sentiment and leisure spending are both more likely to improve than deteriorate. As a result, we feel fairly comfortable with our current leisure …
21st June 2016
In April, the pace of job creation picked up for the second consecutive month. Moreover, with vacancies still high and job creation mainly driven by full-time positions, occupier demand conditions should stay fairly positive. … Employment …
15th June 2016
Last year’s huge surge in investment activity outside the traditional property sectors has not been replicated this year. But even adjusting for this, we have observed a substantial slowdown in activity of about 25% from last year’s peak. To us, however, …
14th June 2016
In May, the value of commercial property deals fell to its second lowest reading this year. That said, we think the moderation in activity reflects pricing concerns more than the Brexit -related uncertainty. As a result, even in the event of an ‘in’ vote …
8th June 2016
The commercial construction PMI dipped once more in May adding to the signs that last year’s spike in commercial development activity will not be repeated in 2016. … CIPS/Markit Construction PMI …
2nd June 2016
Net lending to the property sector fell in April. However, April’s losses barely made a dent in the previous two months’ gains, and with traditional lenders’ exposure to property stabilising, we wouldn’t read too much into today’s fall. … Lending to …
1st June 2016
Released last week, the DeMontford Commercial Property Lending Survey painted a positive picture. Indeed, loan origination and the stock of outstanding debt both rose, while distressed loans fell. That said, lending to development still seems constrained …
31st May 2016
At the all-property level, our forecasts are slightly more positive than the Consensus. However, since we expect any tightening of monetary conditions to be gradual and economic growth hold up fairly well, we feel comfortable with our bullish position. …
27th May 2016
The consensus within the property sector is that, in the event of a vote to remain within the EU, investment demand and activity would rise significantly in the second half of 2016. However, we think that high valuations and the prospect of higher …
26th May 2016
The moderation in capital value growth is likely to continue given that investment activity is subdued, and yield compression and rental value growth are both slowing. However, without a drastic inflation or demand shock, steady growth and low interest …
25th May 2016
The slowdown in capital value growth and total returns that we anticipated in our previous Analyst , appears to be on track. As a result we have made only cosmetic changes to our forecasts. Yet although we anticipate a soft outlook for commercial …
19th May 2016
Brexit worries have been driving sterling lower so far this year. Accordingly, a vote to “remain” in June’s EU referendum should see the pound rebound. But we think any strength is unlikely to be sustained, as monetary policy tightens even faster in the …
18th May 2016
The pace of job creation improved in March, but was nevertheless low by recent standards. That said, in big picture terms, with vacancies still high and job creation driven by full-time positions, occupier demand looks solid. … UK Commercial Property …
Economic theory suggests that the increased transaction costs stemming from the recent changes to the stamp duty regime should be fully and quickly reflected in lower capital values. March’s widespread falls in the IPD indices suggest that, while perhaps …
12th May 2016
London’s active office development pipeline has returned to past peaks, leaving the market vulnerable to an economic downturn. But so close to the EU referendum, we think that it is a sign that growing numbers agree with us that London and the UK will …
11th May 2016
Commercial property deal-making dipped modestly in April. However, the data gave further signs of improving liquidity, and strong overseas demand for UK assets. Nevertheless, with values looking stretched it is hard to envisage a strong rebound in …
10th May 2016
Today’s commercial construction PMI data provided further evidence to expect a slowdown in rental value growth during 2016. However, for now, today’s data give no indication that rents are due to move in reverse. … CIPS/Markit Construction PMI …
4th May 2016
Net lending to the property sector picked up March. However, with traditional lenders’ exposure to the sector simply stabilising and riskier development lending still falling, it is hard to argue that traditional lenders are throwing caution to the wind. …
29th April 2016
The RICS Commercial Property Survey reported that occupier and investor demand moderated but remained positive in the first quarter. That said, the headline figures masked some sectoral variation; occupier market conditions seem healthier in the …
28th April 2016
With investment activity muted, yields approaching their floor, and rental value growth slowing, capital value growth will continue to moderate. That said, healthy economic conditions and loose monetary policy will probably help prevent a significant hit …
25th April 2016
Despite a fall in the pace of construction activity in the first quarter, workload balances in the commercial sector are above the survey’s average. That said, forward-looking indicators, suggest that skill shortages and weaker demand could hold back …
20th April 2016
As the slack in the labour market has fallen substantially, it is perhaps not surprising that job creation has slowed. And for now the data do not point to a turning point in the rental market, but rather to a slower rate of occupier demand growth. … …
Over the next few years, we expect high rents and elevated valuations to act as an increasing drag on capital values for the Central London retail market. That said, structural change in the retail sector should underpin demand ensuring that capital …
18th April 2016
As financial market volatility subsided, commercial property investment activity picked up in March. The latest data point tentatively to improving liquidity, but not to any rise in risk aversion. In the absence of further financial market stress, the …
14th April 2016
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
