INSIGHT: Commercial Property Market Gathers Pace
Karen Piontek, associate lawyer in the property team, shares her views following recent news that the number of UK commercial property transactions has reached its highest level since the credit crunch.
It is encouraging to hear that the number of commercial property transactions is up 24 per cent from a low of 92,900 in 2008/2009, according to recent HMRC data. While it is still significantly lower than the 139,000 sales recorded in 2007/2008, this steady increase in growth within the commercial property sector should hopefully instil much-needed confidence into buyers and investors who may have previously taken their foot off the pedal.
Reports suggest that the relatively high yields on property when compared to other investments, continues to attract both UK and overseas investors, and this is definitely the case from our own experience. The accessibility of bank lending at higher loan-to-value ratios, combined with increasing demand for commercial property within the current market place, must also be a contributing factor.
As a team here at Pearson, we have seen a 50 per cent increase in profit over the last twelve months, working on a broad range of new instructions from development to pension fund acquisitions and re-financing. This is further evidence that there has been a noticeable turnaround in the market and that the economic recovery is gathering pace.
The market may slow down slightly as we enter the holiday season but we expect it to resume shortly thereafter and the challenge going forward will be whether the supply of new stock, such as prime office, retail or residential space, can keep up with this surge in demand.Subscribe to our newsletter
Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.
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