UK commercial property value growth slowed in April

LONDON: British commercial property values rose 0.8 percent in April, half the growth rate in March as the market's run-up in prices lost momentum, the Investment Property Databank (IPD) said on Monday, May 17.

"The rapid bounce back in commercial property pricing at the end of last year has run its course ... indeed, the 80 basis points capital growth recorded for April was half that achieved in March," said Malcolm Hunt, IPD's Head of UK Client Services.

CB Richard Ellis data in earlier May also showed Britain's commercial property rebound losing steam, hit by fears of political and financial market stability.

The benchmark IPD data, used as the basis for Britain's property derivatives market, showed values in Britain have rebounded 14 percent from a two-year downturn since August 2009.

Retail property prices have posted the strongest growth, up 17.2 percent over the period, followed by offices at 12 percent and industrial properties which gained 10.1 percent.

Rentals continued to weaken, however, with average rents for office, retail and industrial properties falling 0.2 percent in April, marking two years of consecutive monthly declines for a compounded 10.8 percent drop.

"The rate of rental decline has broadly been in line with the experience of the early 1990s recession which, after two years, had seen a 13.2 percent decline in rental levels, although falls continued for more than three and a half years," IPD said. - Reuters