Commercial property sees boost from sliding pound

Commercial property sees boost from sliding pound

New survey reveals that the sliding pound and strength of the dollar helped attract overseas investors in British commercial property.

According to a recent industry survey by the Royal Institution of Chartered Surveyors (RICS), overseas demand is likely to bring further recovery in the UK commercial property market, despite the Commons this week overwhelmingly backing the Brexit bill allowing the UK to leave the EU.

The survey revealed that during the last part of 2016, the drop in the pound continued to lure foreign investors.

However, the RICS survey also showed a slower growth due for London commercial properties, with the industry worried that London’s property market will suffer if firms start to leave the capital following Brexit.

The survey shows that at the end of 2016, investment enquiries plateaued in the London office sector and decreased in the London retail segment, despite an increase in enquiries across the UK during the same quarter.  

Worryingly, although the UK commercial property market has generally recovered from the post-Brexit slump, London has not performed as well in the wider market, with some building projects now on hold, property companies slashing rental growth forecasts and rents stagnating.

As a result of the Prime Minister recently confirming that Britain will leave the European single market, banks such as HSBC and UBS have stated that each is prepared to relocate around 1,000 jobs out of London.

18% of those who responded to the RICS survey revealed that firms are definitely considering moving away from the UK after Brexit, which is a rise of 4% on the preceding survey. In central London, 32% of those who responded stated that firms are looking to move away from the area, the largest proportion of any single region.

Continued demand from overseas investors indicates that prospects for the UK property market are still positive, however, with 28% of survey respondents expecting to see an increase in property values over the next year.

RICS Chief Economist Simon Rubinsohn believes that “the results suggest the commercial property market is continuing to attract investor interest despite ongoing concerns about pricing in the capital and the prospects for the economy more generally. Indeed, the feedback RICS have received is consistent with a renewed appetite from overseas buyers for UK assets.”

As ever, we at Guardians of London fear that the London property market will continue to suffer with plans for Brexit now finally underway, severely affecting those landlords of short and long term empty properties in the capital, hoping to attract investment. Property guardianship remains the most reliable way for these landlords to protect their empty buildings from vandalism and from occupation by squatters.

The issue of squatters is topical, worrying and ongoing, as demonstrated only last week when a group of squatters took over the £15 million home of a Russian oligarch in Belgravia, causing thousands of pounds of damage before finally being evicted.

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Tom Allen
Tom Allen 20 Sep 2017

Absolutely agree with you!

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RyanGeo 18 Sep 2017

A sharp correction would be a less dramatic expression to use. That is already underway in certain sectors in Reading where I practice as Chartered Surveyor

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sean benton
sean benton 01 Sep 2017

Identity theft is a thread for any profession. So,people should stay alarmed. I once take help from a letting agent and came to know that letting agents are taking every precaution to prevent fraudulent...

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Mark N.
Mark N. 30 Aug 2017

We have seen a surge in instructions over August and that should continue into September too.

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Chris 30 Aug 2017

Unfortunately, all the legislation bears its force on Landlords and ignores, naively, the effect of Rogue Tenants on the ability of landlords to keep houses in repair and offer properties for rent at reasonable...

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Christian Donovan
Christian Donovan 18 Aug 2017

The write-down on house values, combined with the fall in the GBP saddled the fund?s property portfolio with a 1.4% loss in the second quarter. The shocking amount of $240 million.

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Samantha Goodman
Samantha Goodman 11 Aug 2017

Interesting point of view.

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Samantha Goodman
Samantha Goodman 11 Aug 2017

It depends on the people, some older adults decide to make a long-distance move in order to live closer to their children or settle in a place with a lower cost of living.

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brandonlee10 24 Jul 2017

The financial ramifications of the triggering of Article 50, the starting gun for Britain's departure from the EU, are far from clear. Buyers will be most cautious in London, given that buying a home in...

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IrisJ. 19 Jul 2017

Great advice, but may I also add that when buying an already built home, make sure you do all of the proper inspections. Most importantly pest inspection because people tend to get surprised when they

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IrisJ. 17 Jul 2017

The third point is, in my opinion, the most important one. People have become too inconsiderate and careless when it comes to rented properties. If a landlord wants to protect their property, regular visits...

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cornishalan 10 Jul 2017

Added to the cost of purchasing these village properties are the above average maintenance costs. Particularly where the property is a listed building or requires specialist building skills such as thatching...

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