THE UK high street’s woes will not let up in coming months, and rents will continue to fall, according to a survey out this morning.
A glut of unoccupied floor space and continued weakness in retail demand will hold rents down, the Royal Institution of Chartered Surveyors (RICS) survey suggested.
Some 22 per cent more respondents said retail sector rents had further to fall than said they would rise over the first quarter of 2013, indicating that the troubled sector may worsen further – even after Jessops, HMV and Blockbuster fell into administration.
“The end of 2012 was yet another incredibly tough period for the high street,” said RICS economist Simon Rubinsohn. “Sadly, this downbeat picture doesn’t look like changing any time soon, with demand for retail space continuing to drop and more empty premises set to blight the country’s town centres.”
Other sectors of commercial property were doing much better, according to the RICS survey, with the overall demand for commercial space growing, especially in the office sector, where a balance of around 20 per cent said demand was on the up. Demand also increased in the UK’s hard-pressed industrial sector, the RICS survey showed.
But the overall increase in demand is not expected to translate into increased rents or property values. A narrow margin of three percentage points of the chartered surveyors polled thought capital values were on the slide in the coming three months, while a nine percentage point majority reckoned rents would fall.