propertytalk Live! - Cautious optimism for commercial property market

propertytalk Live! - Cautious optimism for commercial property market

The latest RICS Commercial Property Market Survey shows further modest improvement in the real estate market but highlights pronounced regional and sector differences in both the occupier and investment arenas.

Eighteen per cent more surveyors expected new sales and lettings to increase in the next three months, a rise from Q3 2010 (+8). This is the best reading since before the onset of the credit crunch (Q1 2007).

Meanwhile, 8 per cent more reported a rise than fall in occupier enquiries (compared with -22 previously), suggesting that some businesses may now be looking to expand.

Significantly, in the last three months of 2010, overall tenant demand for commercial property stabilised with a net balance of zero (from -6). While the picture clearly is improving, surveyors continue to cite uncertainty over the prospects for the economy as a drag on the market.

Turning to supply to the market, just 4 per cent more surveyors saw an increase rather than a decrease in available occupier space (down from a reading of +16 in Q3). In the office sector, available space registered a zero net balance, the lowest since Q4 2007. However, available space continued to edge up in both the industrial and retail segments of the market, albeit at a lesser rate (+5 and +4 respectively).