April 10, 2002—The first three months of the year saw a fall in rental values in Central London due to weak demand and rising availability, according to CB Hillier Parker.
Property yields improved marginally, but the All Property Rent Index experienced the first quarterly rental fall since 1993. The all office rent index was down for the second consecutive quarter and the average rental values decreased both in the West End by 7.6%, and the City by 4.2%. This was supported by Jones Lang LaSalle research, which showed investment in commercial property in the City of London had fallen to its lowest level for five years.
The property consultant predicts a difficult year for the UK property market this year, and says even the medium-term outlook is uncertain: “The outlook for rental value growth is subdued across all sectors of the market, with falling office rental values the most evident sign of the weakening conditions within the occupational market.”
—Jessica Jarlvi
Reprinted with permission; copyright 2002 i-FM
