The economic climate in the UK is warming up and this has resulted in successive years of improvement in the property market with 2015 seeing a marked turning point. New figures suggest that the number of UK commercial property transactions has reached its highest level since 2007/8.
In the last year there have been 115,400 sales, which is a 6% jump on the previous year, according to data from the HMRC. The data shows that the number of transactions is up by 24% from the lowest point of the credit crunch, 2008/9, where there were 92,900 sales. There is still some way to go to reach pre-crash levels, as 2007/8 recorded 139,000 sales but it shows a serious step in the right direction for the commercial property market.
The UK has benefited from record low interest rates driving up the sales levels towards those of the pre-credit crunch era and close analysis of the figures has shown that property in England is dominating these sales figures, although other parts of the United Kingdom aren’t far behind and this has been the consistent trend year on year.
Increased Lending equals Increased Spending
The low interest rates already mentioned has brought in renewed interest from overseas investors as the UK is more able to offer investor friendly lease terms and the demand for property is so high in London in particular, with shortage of prime office space for lease, that many investors are seeing the potential in buying up their own property whilst the opportunity is there.
Bank lending is also on the up which is allowing investors and property developers to be more active and increase their spending, with some banks happier to fund purchases at high loan to value rates, allowing investors to finally make the moves they want and invest in a savvy and forward thinking way.
Upward Pressure on Prime Office Rents
As mentioned, the demand for quality office space has become a serious problem in London but it isn’t limited to the city. Savills latest report has found that the majority of the top nine regional cities are experiencing upward pressure on prime office rents due to a rise in leasing activity and a fall in availability.
There is a real demand for more in the commercial rental sector and Savills confirm this with their suggestion of stronger than normal rental growth in the industrial sector for the rest of 2015. Investors will need to look to find the best possible asset management and rental growth options which are set to deliver top returns, as this is a sector which is only set to grow more.
UK business is back on the up and this means entrepreneurs are hungry for their own piece of land. Whether it’s a single office, a whole block or a unique investment opportunity, the commercial property sector is looking like the place to be for investment professionals in 2015 and beyond.
Joining Eddisons as an Associate Director in 2013, Steven brings to the table over ten years’ experience as a surveyor, particularly active within the Yorkshire commercial property market as a professional consultant in general practice, including five years plus PQE (Post Qualified Experience).
Steven now leads the Leeds agency team providing coverage in investment brokerage, industrial and logistics as well as office agency and development.
As a member of The Royal Institution of Chartered Surveyors (MRICS), The Leeds Office Agents Forum (LOAF), The Industrial Agents Society (IAS), and as Joint Chairman of The Office Agents Society (OAS) for Yorkshire, Steven’s solid industry knowledge, expertise and networks make him a reliable reference point for clients ranging from high net worth individuals, occupiers, PLCs, regional property companies as well as banks and investors.