Commercial property hit by slump
BRITISH commercial property values rose 0.5 per cent in June, as in May, in what is a further sign that this market’s 11-month rebound is losing steam, data showed yesterday.
The Investment Property Databank’s ( IPD ) monthly index had registered a 0.5 per cent rise in May, from a 0.8 per cent rise in April. UK commercial property prices have now shown positive gains for 11 consecutive months, after a two-year downturn.
“UK commercial property capital appreciation has eased to its slowest quarterly growth since the rebound manifested last August, at 1.9 per cent over the second quarter,” the IPD said. “Commercial property values are now back to December 2008 levels –?with the re-pricing from the first 18 months of the correction still unreversed,” it added in a statement.
The benchmark IPD data, used as the basis for UK’s property derivatives market, also showed rents, for office, retail and industrial properties, rose 0.6 per cent on average.
Phil Tily, the UK and Ireland managing director at IPD , said after three volatile years, the fundamentals driving the property market appeared to be moderating. “Whether this proves to be the calm after a very long storm depends upon the course of the domestic economy,” he said.