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RICS UK Commercial Property Market Survey, Q2 2016

Thursday, August 04, 2016

A review of the RICS UK Commercial Property Market Survey, Q2 2016 from Senior Economist Jeffrey Matsu.

The Q2 2016 RICS UK Commercial Property Market Survey shows a significant deterioration in market sentiment following the Brexit vote. The heightened sense of caution is visible across both investment and occupier sides of the market, with uncertainty pushing rental and capital value projections
into negative territory. Whether or not the adverse hit to sentiment is a knee-jerk reaction that will unwind as the result is digested, or the start of a more prolonged downturn, remains to be seen.

On a UK-wide basis, occupier demand failed to rise for the first time since 2012. The headline net balance fell from +21% previously to a reading of zero in Q2. Declines were reported in the office and retail areas of the market but demand proved somewhat more resilient across the industrial sector. The regional breakdown shows the occupier demand gauge moderated across all parts of the country, although the shift was most noticeable in London. Alongside this, availability remains constricted, with the supply of leasable space more or less unchanged in the office and retail sectors during Q2, while industrial availability continued to decline

For a full run through of the survey, click here: RICS UK Commercial Property Market Survey, Q2 2016