The improvement in UK office take-up is a boost to the commercial property industry and suggests that confidence is returning among tenants…
UK property companies have been badly affected by the financial crisis, with the fall in capital values leading them to significant pre-tax losses, and they are therefore keen to maintain cash flow by filling empty space.
With many businesses struggling, those looking for space have been able to grab deals weighted in their favour.
According to the research by NB Real Estate, office take-up improved from 923,000 sq ft in the first quarter of 2009 to 1.8m sq ft, however vacancy rates still rose from 10.2 per cent to 11.3 pc in the City and 7.4 pc to 8.4 pc in the West End as new space came on to the market.
Peter Trinder, Director of NB Real Estate, said, "Many occupiers postponed decisions about property during the last year, but there are now some very attractive deals on the market. Landlords and occupiers are now liable for full rates on empty buildings. This is providing an added incentive to get space let and off the market. It is forcing them into doing deals they might otherwise not have done."
A further report by accountancy firm BDO Stoy Hayward supports evidence of an improvement in commercial property. It shows that investor returns have improved in the UK market from -5.27 per cent in January, to -0.9 per cent, the highest level for more than a year.
Source: www.telegraph.co.uk
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