{"id":7305,"date":"2022-07-27T12:50:24","date_gmt":"2022-07-27T11:50:24","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/07\/27\/commercial-property-market-review-july-2022\/"},"modified":"2022-08-19T10:53:55","modified_gmt":"2022-08-19T09:53:55","slug":"commercial-property-market-review-july-2022","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/tomd\/2022\/07\/27\/commercial-property-market-review-july-2022\/","title":{"rendered":"Commercial Property Market Review – July 2022"},"content":{"rendered":"
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Strong first half for commercial property<\/strong><\/p>\n<\/div>\n\n

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Investment and take-up performed strongly in H1 2022,\naccording to Savills\u2019 latest UK Commercial Property update, while vacancy rates\nremained low.<\/strong><\/p>\n<\/div>\n\n

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Overall investment levels in H1 2022 were 20% above the long-term\naverage, even after slowing in the second quarter.The total half-yearly\ninvestment of \u00a325.4bn came mostly towards the start of 2022, with just \u00a38.3bn transacted\nin Q2.<\/p>\n<\/div>\n\n

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Occupier markets remain strong across the board, with take-up\nreaching a record-breaking 28.6m sq. ft in the logistics market in H1 2022, 91%\nabove the long-term average. In the City, meanwhile, year-to-date take-up was\n2.3m sq. ft, 5% above the 10-year average.<\/p>\n<\/div>\n\n

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Accordingly, vacancy rates in the logistics market remain \u2018structurally\nlow\u2019<\/em>, Savills noted, at just 3.01%. Likewise, in the regional office\nmarket, vacancy has fallen to 9.4%, as occupier demand edges back towards pre-COVID\nlevels. Overall vacancy is likely to remain low going forward, Savills expects.<\/p>\n<\/div>\n\n

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Another key trend identified in the report is the shift in new\noccupier requirements towards manufacturing closer to the point of sale. As companies\nswap ‘just in time’ for \u2018just in case’ supply chains, analysts expect demand to\nstrengthen further.<\/p>\n<\/div>\n\n

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Shopping centre investment up in H1 2022<\/strong><\/p>\n<\/div>\n\n

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Investment in UK shopping centres has increased by 169%\nyear-on-year, according to Knight Frank\u2019s H1 2022 Retail Investment Report, as\ninvestors prepare for an anticipated return to pre-pandemic shopping habits.<\/strong><\/p>\n<\/div>\n\n

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The report reveals that shopping centre investment volumes\nclimbed to \u00a31.24bn in H1 2022, up from \u00a3460m a year earlier. Overseas and\nprivate equity investors led the way, though institutional investment into the\noutlet sector also contributed to the rise.<\/p>\n<\/div>\n\n

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Investor demand was focused mostly on smaller in-town\nshopping centres, the report highlighted, even as a handful of larger \u2018destination\u2019\nmalls were sold. Notably, Switzerland-based Redical Capital acquired Victoria\nGate and Victoria Quarter in Leeds for a\ncombined \u00a3120m.<\/p>\n<\/div>\n\n

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Will Lund, of Knight Frank, commented, \u201cAfter years of\nfalling valuations we are seeing a shift in investor sentiment and shopping\ncentres starting to come back into fashion [\u2026] With pricing and rents now\nstabilising, investors are beginning to see the long-term appeal and resilience\nof shopping centres as a key part of modern multichannel retail.\u201d<\/em><\/p>\n<\/div>\n\n

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Quality logistics space still in demand<\/strong><\/p>\n<\/div>\n\n

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High demand and an acute lack of available stock have\npushed the UK vacancy rate to a new low of 1.18%, according to CBRE\u2019s UK\nLogistics figures Q2 2022, as quality space continues to dominate the market.<\/strong><\/p>\n<\/div>\n\n

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H1 2022 saw record-breaking take-up in the logistics market,\nwith a 9% increase from H1 2021. In Scotland, on the other hand, the vacancy\nrate is now 6.85%, according to Savills, with take-up of units over 100,000 sq.\nft subdued so far this year.<\/p>\n<\/div>\n\n

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Poor quality available space is holding the Scottish market back,\nanalysts suggest. Currently, all space on the market is classified as Grade B (23%)\nor Grade C (77%), while the only 100,000 sq. ft transaction in 2022 was for a\nGrade A built-to-suit space.<\/p>\n<\/div>\n\n

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Google\u2019s 330-metre vote of confidence in office\nworking<\/strong><\/p>\n<\/div>\n\n

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Construction has been completed at Google\u2019s new UK HQ,\nthe first Google-owned and designed building outside the US, in a sign of the\ncompany\u2019s commitment to post-pandemic office working.<\/strong><\/p>\n<\/div>\n\n

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Based in London, between King\u2019s Cross and St Pancras, the\nnew HQ comes complete with a pool, nap pods and rooftop exercise track.\nNicknamed the \u2018landscraper\u2019<\/em>, the building reaches 72 metres at its\nhighest point and stretches to 330 metres \u2013 which means it is longer than the Shard\nis tall. It is expected that 4,000 of Google\u2019s current 6,400 staff will work in\nthe new office building from 2024.<\/p>\n<\/div>\n\n

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Many companies are still working out the quantity and types of\nspace required in the post-pandemic landscape. Google, for example, seems to\nhave committed to hybrid working. In 2021, Chief Executive Sundar Pichai\nannounced that most of its staff would spend three days in the office and \u201ctwo\ndays wherever they work best\u201d.<\/em><\/p>\n<\/div>\n\n

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All\ndetails are correct at the time of writing (21 July 2022)<\/strong><\/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":"

Strong first half for commercial property Investment and take-up performed strongly in H1 2022, according to Savills\u2019 latest UK Commercial Property update, while vacancy rates remained low. Overall investment levels in H1 2022 were 20% above the long-term average, even after slowing in the second quarter.The total half-yearly investment of \u00a325.4bn came mostly towards the […]<\/p>\n","protected":false},"author":12,"featured_media":7307,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[32,134],"tags":[],"hd_content_source":[116],"_links":{"self":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/7305"}],"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=7305"}],"version-history":[{"count":1,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/7305\/revisions"}],"predecessor-version":[{"id":7309,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/7305\/revisions\/7309"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media\/7307"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media?parent=7305"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/categories?post=7305"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/tags?post=7305"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/hd_content_source?post=7305"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}