The latest Commercial Property Market survey report from the RICS is now available and headlines ‘Industrial sector remains strong while retail struggles’, and summarises its findings as:
The survey reports tenant demand increased strongly across industrial space and stabilised in the office sector, having fallen in Q2. Meanwhile, demand continued to fall for the second consecutive quarter in the retail sector. At the same time, availability of leasable space is said to have declined markedly in the industrial whilst showing little change across the office and retail sectors.
The relative strength of the industrial sector was also evidenced by a decline in landlord incentives being offered and an anticipation that near term rent expectations point to firm growth in the sector. By contrast near term expectations for office rental values are flat and in the retail segment, projections remain marginally negative at the headline level with secondary retail rents anticipated to decline over the coming twelve months.
Trends in capital values are broadly expected to mirror those in the rental market with growth anticipated in shed values, offices and retail broadly flat but with secondary retail possibly seeing reductions over the year ahead.
All in all a mixed bag.
Interestingly on the back of the strength in the sheds market here in Devon we are beginning to see development sites for employment uses coming forward and interest being shown in speculative development.