Tag Archives: london
Demand remains strong in all commercial property sectors in UK
Commercial property prices in the UK continue to rise as demand remains strong in all sectors according to the latest survey from the Royal Institution of Chartered Surveyors (RICS). UK Commercial Property is still seen as a safe haven for investors with rents and capital values set to continue rising despite macro concerns, the survey says. With businesses across the UK thriving and employment data still strong, the industrial sector has the greatest momentum in occupier demand. Some 43% more chartered surveyors are seeing a rise in demand for industrial space in the fourth quarter of 2015, compared to 29% more seeing a rise rather than fall in demand for offices and 26% more seeing a rise in demand for retail. As demand increases, supply has continued to decrease across the UK with the survey recording the eleventh consecutive quarterly drop in available space across the commercial property market. The survey report also says that development nationally has only increased marginally with anecdotal evidence suggesting that there is a lack of commercial construction activity in many locations. It also explains that a deepening skills crisis is playing a key role in inhibiting development. One notable exception to the low level of new build across the UK is in the London office sector, where development has risen sharply over the last three quarters and 34% more surveyors saw a rise rather than fall in office development starts in the quarter. In the face of continued demand and lack of supply, rent expectations for the next quarter are strongly positive across all sectors with 35% more chartered surveyors projecting a rise in rents across all sectors. Industrial space was again the strongest performer with 43% more surveyors envisaging a further rise rather than fall in rents. Looking at the investment market, buyer enquiries have risen in each sector albeit less than previously and the upward trend in foreign buyers has noticeably flattened. Notwithstanding this, capital values are forecast to rise further in all sectors of the market in both the near and longer term with prime office and industrial sectors most likely to outperform. Looking further forward, all sector rents are set to continue to rise both in the medium and longer term. Over the next 12 months, respondents are most confident of seeing rental increases in the prime industrial market with 87% more respondents foreseeing a rise as opposed to a fall. At the other end of the scale, secondary retail space exhibits the most modest reading on a sectoral comparison, but still posted a relatively healthy balance of +51% expecting rents to grow. Regionally price expectations are positive across the UK, with the strongest performers expected to be London and the East, however, 81% of respondents in the capital now view commercial real estate in central London to be overpriced, slightly up on the 77% who took this view in the third quarter survey. The report also points out that there… Continue reading
UK govt puts public land up for sale for new home building
The UK Government has published details of 600 acres of surplus public sector land for sale as part of its drive to see tens of thousands of new homes built across the country. Housing Minister Brandon Lewis urged developers to seize the opportunity and look at the sites via the Homes and Communities Agency (HCA). Some 80 public land sites are now for sale and there will be 40 more over the next 18 months. It is estimated these sites will support more than 5,000 homes as well as land for industry and business. Over 20% of the sites already have outline or detailed planning permission. Lewis pointed out that the Government has embarked on the largest house building programme since the 1970s and said that some 160,000 new homes should be built through the sale of surplus public sector land. ‘Using surplus public sector land for housing has helped us get the country building again with the number of new homes up by 25%. Selling off these sites will allow us to go even further, delivering on our ambition to support a further 160,000 homes, while providing a significant boost to local economies and the taxpayer,’ he said. ‘I now want to see developers getting shovels in the ground as quick as possible and build the homes hard working people want and deserve,’ he added. The HCA is the government’s disposal agency for surplus public land, and using its local market knowledge, commercial expertise and experience of managing large portfolios of land, exceeded its contribution to the government’s last land programme by more than 3,000 homes. In total, Whitehall departments released enough public sector land to support more than 109,000 homes during the last parliament, Lewis also pointed out. ‘The sale of surplus public land helps to meet government priorities to build more homes and business premises, while delivering a financial return to the taxpayer,’ said HCA chief executive Andy Rose. ‘We will use our commercial expertise and local market knowledge to make land attractive to house builders, to help get homes built more quickly and meet local priorities. As the government’s disposal agency for surplus public land, we are well placed to support other departments and agencies in meeting their contribution to the government’s land programme,’ he added. A new Land Development and Disposal Plan sets out some key principles of land disposal, which followed a review of the HCA’s processes and were developed in cooperation with the Home Builders Federation and its members. These include clearer objectives for each site prior to sale, early and meaningful market engagement with a transparent pipeline of sites and clearer commercial terms. ‘Public sector land accounts for a significant proportion of potential residential land and can play an important part in helping the country to boost housing numbers,’ said David O’Leary, policy director at the Home Builders Federation. ‘The role of the HCA is critical in helping the government to meet its ambitious targets for releasing public land for… Continue reading
US residential rents set to slowdown in 2016
Residential rent growth in the United States is expected to level off over the next 12 months, slowing to an annual rate of 1.1% by December 2016. The average at the end of 2016 is projected to be $1,396 compared to $1,381 in December 2015, according to the latest rent forecast from real estate data firm Zillow. The firm is forecasting a decrease in the rate of rental appreciation amid a rental affordability crisis that has renters in some markets spending almost half of their income on rent. Some of the fastest growing metros had double digit annual rental appreciation at the end of 2015 and Zillow expects rental appreciation to slow down most significantly in Nashville, San Francisco, Portland and Denver. Rents in San Francisco saw a 12.5% rise in 2015 and the Zillow forecast is for growth in San Francisco to be 5.9% in 2016, half as fast as in 2015. Even with the slowdown, rents will remain unaffordable in many of the major markets across the US, especially on the West Coast. Renters in San Francisco and Los Angeles can expect to spend 40% of their income on a rental payments. ‘Hot markets are still going to be hot in 2016, but rents won't rise as quickly as they have been. The slowdown in rental appreciation will provide some relief for renters who've been seeing their rents rise dramatically every single year for the past few years. However, the situation remains tough on the ground and rents are still rising and renters are struggling to keep up,’ said Zillow chief economist Dr. Svenja Gudell. She pointed out that the slowdown in rental appreciation indicates that supply of new multi-family homes is catching up to demand. Substantial new housing supply is becoming available in Atlanta, Denver, Portland, Seattle, and other markets. Continue reading
