The UK commercial rental property sector is showing slow but sure signs of improvement. According to an article on WalesOnline, the decline in rental rates has slowed, while demand is gradually picking up.
London and Wales are showing particularly promising signs, according to James Petherick of GVA Grimley?s team in Cardiff. Welsh commercial properties were the first to show signs of promise during the second half of 2009.
Mr Petherick said: ?Central London offices, which tend to lead the rest of the UK market, have seen a major improvement in recent months signifying that trading conditions are back on their feet and a resumption of rental growth is anticipated this year.? Although office business parks have not yet followed this trend, Mr Petherick indicated that the outlook is most likely positive.
The trend in Wales was greatly influenced by Welsh Water?s purchase of Linea House on St Mellons Business Park in Cardiff, a 75,000 square feet property. The property is reported to be worth ?12 million and represents Cardiff?s biggest transaction of the kind in eight years.
It appears that Wales is therefore taking the lead, even over the highly reputable London market, in the commercial property recovery rate.
Mr Petherick said: ?We?re past the worst of it. The business parks market looks set to gradually strengthen in the short term, despite its slowness to react to improving conditions.?
He also said that there will be significant growth in various sectors during the next decade, including advanced engineering, telecoms, IT, and green technology. This growth is likely to stimulate demand for commercial rental space.
