{"id":6109,"date":"2022-05-27T11:46:51","date_gmt":"2022-05-27T10:46:51","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/05\/27\/property-marketing-review-may-2022\/"},"modified":"2022-07-05T13:33:07","modified_gmt":"2022-07-05T12:33:07","slug":"property-market-review-may-2022","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/05\/27\/property-market-review-may-2022\/","title":{"rendered":"Commercial Property Market Review – May 2022"},"content":{"rendered":"
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Return to the office<\/strong><\/p>\n<\/div>\n\n

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According to a recent business update, London\u2019s\noffice-leasing market is kicking back into life after its pandemic-induced slumber,\nwith modern and energy-efficient space most in demand.<\/strong><\/p>\n<\/div>\n\n

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Companies are willing to pay higher rents for leases than they\nwere a year earlier, according to Derwent London, a FTSE 250 office landlord. The\nvalue of its new lettings have risen to \u00a33.9m in the year to date, 8.2% above\nthe estimated rental value in December.<\/p>\n<\/div>\n\n

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With the rise in flexible working, however, office occupancy\nremains far below pre-pandemic levels. Nationwide, the figure is currently about\n26%, according to Remit Consulting, a significant fall from 60% before the\npandemic.<\/p>\n<\/div>\n\n

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This low occupancy rate has allowed new tenants to focus on\nsecuring high-quality space. Occupiers\u2019 requirements are narrower but more\nimmutable, Derwent said, with modern, energy-efficient offices that contribute\nto lowering a company\u2019s carbon emissions highly sought after.<\/p>\n<\/div>\n\n

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Strong demand but caution endures<\/strong><\/p>\n<\/div>\n\n

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The commercial market gained momentum in Q1 2022,\naccording to the latest Royal Institution of Chartered Surveyors UK Commercial\nProperty Survey, with demand growth accelerating at the headline level for both\noccupiers and investors.<\/strong><\/p>\n<\/div>\n\n

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A net balance of +32% of respondents reported an increase in\noccupier demand at the all-sector level, the strongest reading since 2015. The\noffice occupier market was a top performer in the quarter, increasing its net\nbalance from -3% to +30%. Office occupier demand in the retail sector returned\nto -1%, following  level of -23% in Q4\n2021.<\/p>\n<\/div>\n\n

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Investor demand was strong too, with a net balance of +32%\nof respondents reporting an increase in buyer enquiries at the all-property\nlevel. Alongside a steady increase in the supply of leasable office and retail\nspace, sustained demand has led to the all-property capital value expectations being\nrevised higher for the coming year.<\/p>\n<\/div>\n\n

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Despite these strong figures, however, many contributors\nremain cautious in the face of macroeconomic pressures. Rising living costs and\nhigher interest rates are causing some to point to a growing sense of\nnervousness in the market.<\/p>\n<\/div>\n\n

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Logistics quarterly round-up<\/strong><\/p>\n<\/div>\n\n

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Uptake of logistics space in Q1 2022 totalled 10.43m sq.\nft, according to CBRE\u2019s latest UK Logistics Market Summary, twice as high as\nthe corresponding figure in 2021.<\/strong><\/p>\n<\/div>\n\n

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Correspondingly, the UK vacancy rate fell in the quarter and\ncurrently sits at 1.55%. Ready-to-occupy supply also dipped slightly on a\nquarterly basis, meaning it has now fallen 55% year-on-year.<\/p>\n<\/div>\n\n

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This busy activity, however, is being matched by increased\nspeculative activity. The total speculative under construction space at the end\nof the quarter was 14.97m sq. ft. Even though more than a third has already\nbeen taken, the year ahead should be busy, the report suggests.<\/p>\n<\/div>\n\n

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Continuing the trend, nearly all UK regions experienced rental growth in the quarter, as UK prime rents recorded yet another new record. Driven by this strength, Q1 industrial and logistics investment volumes, although lower than Q4 2021\u2019s record levels, have risen 19% year-on-year.<\/p>\n<\/div>\n\n

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It is important to take professional advice before making any\ndecision relating to your personal finances. Information within this document\nis based on our current understanding and can be subject to change without\nnotice and the accuracy and completeness of the information cannot be\nguaranteed. It does not provide individual tailored investment advice and is\nfor guidance only. Some rules may vary in different parts of the UK. We cannot\nassume legal liability for any errors or omissions it might contain. Levels and\nbases of, and reliefs from, taxation are those currently applying or proposed\nand are subject to change; their value depends on the individual circumstances\nof the investor. No part of this document may be reproduced in any manner\nwithout prior permission.<\/em><\/strong><\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

Return to the office According to a recent business update, London\u2019s office-leasing market is kicking back into life after its pandemic-induced slumber, with modern and energy-efficient space most in demand. Companies are willing to pay higher rents for leases than they were a year earlier, according to Derwent London, a FTSE 250 office landlord. The […]<\/p>\n","protected":false},"author":12,"featured_media":6111,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[32,36],"tags":[],"hd_content_source":[116],"_links":{"self":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/6109"}],"collection":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/comments?post=6109"}],"version-history":[{"count":6,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/6109\/revisions"}],"predecessor-version":[{"id":6642,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/6109\/revisions\/6642"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media\/6111"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media?parent=6109"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/categories?post=6109"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/tags?post=6109"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/hd_content_source?post=6109"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}