Surveyors report confidence returning to commercial property market

Surveyors report confidence returning to commercial property market


Although it may not be the swift recovery industry figures had hoped for, the latest report from the Royal Institute of Chartered Surveyors (RICS) has shown that there has been a marked improvement in demand for commercial property.

This is not to say that there has been an increase in demand, moreover the decline in demand has begun to slow.

However after a year that has been universally described as horrific by all in the commercial property sector, the easing decline has been welcomed as good news and a strong indication that confidence is returning to investors and businesses looking to buy into the market or acquire new offices.

According to the Financial Times, the net balances for new inquiries from tenants were the least negative since the onset of the downturn in late 2007. In the office sector, the net balance actually turned positive.

Overall in the second quarter of 2009, 13% more surveyors reported a drop in tenant demand, compared to 40% in the first quarter. In the office sector, 1% more surveyors said there had been a rise in demand, which is significantly higher than the 37% that reported a fall in the first quarter.

Senior economist at RICS, Oliver Gilmartin, said that whilst tenant demand had “improved modestly” it is still unclear whether this marks a sustained recovery.

“The rental downturn remains in its infancy with strong levels of surveyor inducements pointing to a challenging lettings market.” He concluded.

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