Richard Carr, a Commercial and Residential Development Specialist, was pleased to read propertywire.com’s report outlining the current strength of the commercial property rental market.
Highest growth since 2007
Real Estate firm CBRE’s report, published earlier this year, indicated that the UK commercial property markets have recorded their highest rental value growth since the third quarter of 2007.
This is excellent news for commercial developers, especially those operating in central London. The country’s capital experienced the strongest rental value growth of the 1,022 locations monitored. In total 16% of the locations showed an increase in rental value.
During last year, prime rental growth was 3.8%, up 2.8% on 2013. Within the office sector, London recorded 11.4% of rental growth compared with the UK as a whole of 8.1% in 2013. In comparison, the South East and Eastern regions of the UK stood out because of their lack of rental growth.
Investment on the rise
Speaking to propertywire.com, CBRE Senior Director Michael Haddock said: “During 2014 we have seen prime rental growth strengthening across many UK markets. Prime yields also recorded a substantial improvement, reflecting the growth in investment activity over the last year.
“At a national level, total transaction volume reached £61.7 billion in 2014 compared to £54.5 billion in 2013 and just beating the total reached in 2006.”
Interestingly, the gap between London and the rest of the UK has shown signs of narrowing over the last year. During the final quarter of last year, the East Midlands and Yorkshire and Humberside recorded the highest capital value growth in the office sector.
The Office sector is a clear indicator of this with growth experienced across the UK. Central London recorded growth of 7.2% in the quarter and 15.6% for the year as a whole.
North is catching the south
Richard Carr believes that this news is fantastic for the UK and again further highlights the recovery is well on its way. It’s also good to see the North of the UK improving and catching up with the South.
The above isn’t the only example, recently it was reported that they average wages are rising faster in the North than the South. Let’s just hope it continues after May!