Commercial property ‘will see strong returns into 2010’

Posted 09/12/2009

The recent recovery of the UK commercial property sector is set to continue with positive returns well into next year, according to a report.

Statistics from November 2009 released by commercial property firm CB Richard Ellis (CBRE) show that total returns for the month stood at 3.4 per cent, the best result in the history of the company’s monthly index.

Capital values are also on the rise, led by marked increases of four per cent and 3.9 per cent for retail warehouses and shopping centres.

David Wylie, head of economics and forecasting at CBRE, said this performance is due to the “strength and depth” of investor demand, which will sustain this recovery into the new year.

However, he cautioned that the relative weakness of the rental sector, coupled with increasing supply of properties, may yet “act as a brake on the strength of the recent recovery”.

In October, the British Property Federation highlighted the return to positive commercial property returns as potentially signifying a “turning point” for the sector.