Commercial property rents continued to rise in the second quarter of 2013, according to CBRE's UK Q2 2013 survey.
Property rents having risen by 0.7 per cent over the quarter, specifically, the prime office market celebrated a growth of 1.7 per cent in its rental values, while none of the regional offices outside of the capital city recorded any rental drops. Even though central London has seen the highest growth in rent in the past 12 months, at five per cent, the south-east of England has also been following in tow with high rises for prime offices.
Aleksandra Starczynska, analyst at CBRE research, said: “These results show that a more widespread recovery in the UK property market is starting to become apparent. After a long period during which rental growth and falling yields have been confined almost entirely to London and the south-east, Q2 has seen more positive performance in the rest of the UK. This more positive trend in the UK real estate sector is in line with what is also being reported in the economy generally, through business surveys and other data.”
The average yield for prime properties fell during the quarter, a pattern that was also seen in the first three months of 2013. The office and industrial sub-sectors experienced falls in yields in both central London and the rest of the UK, while retail yields generally remained flat, with slight falls and rises recorded in central London and the rest of the UK respectively.
Generally, the retail market remains polarised, with rental growth seen in London and the south-east of England, but then negative trends for the rest of the country. When taking London and the south-east out of the picture, high street rents had fallen by 0.6 per cent in the quarter.