New figures by property firm Savills have revealed that the commercial property sector is growing at its fast rate since May 2007.
In July 2013, the balance between respondents who reported either increasing or decreasing activity within the sector, compared to the previous month, stood at +20.1 per cent. This was up from the +18.9 per cent recorded in June 2013. The private sector continued to lead the figures, with a net balance of +25.9 per cent, while public new-build also experienced an increase of +1.4 per cent. Furthermore, activity in the industrial and warehouse market saw a huge rise from +26.3 per cent in June to +32.6 per cent the following month, and private office activity had a net balance of +30.8 per cent, the strongest increase in over nine years.
Industry analysts have suggested that warmer weather conditions, increased credit from banks and improved client confidence of the wider economy are all factors that have attributed towards this boost in sector activity over the past few months. This has led to developers suggesting that forecasts for the next quarter should generally be positive. Around 25.1 per cent of the sample is optimistic towards the next three months, a rise from the 14 per cent who had the same opinion in June.
Savills director of building consultancy Michael Pillow said: "The sharp rise in confidence bodes well for development activity in the second half of the year. Developers will continue to be restrained by lack of debt but this should ensure a sustainable recovery."
It was not all good news however. Activity within the public retail and leisure sectors experienced slight reductions in July. Investors will be waiting with bated breath to see how these markets perform across the second half of the year.