Investor demand strengthens across all UK property sectors

A growing number of investors are actively investing in the UK commercial property market, the latest report from the Royal Institution of Chartered Surveyors (RICS) shows.

According to RICS’ UK Commercial Property Market Survey, 18% more surveyors taking part in the study reported an increase in enquiries from investors in the first quarter of the year, with investor demand for industrial space proving particularly popular.

RICS said 28% more respondents saw an increase in demand for industrial space across the UK in the first three months of the year, outperforming demand for office and retail space.

Demand for industrial investments is being driven by promising prospects for capital growth, with 44% more respondents anticipating price growth over the next three months, while the supply-demand imbalance in the rental market is also pushing rental values in the industrial sector higher.

Overall tenant demand for commercial property in the UK rose for the third quarter in a row with 12% more respondents seeing an increase in demand.

Simon Rubinsohn, RICS’ chief economist, commented: “The results of the latest commercial property survey chime with much of the recent generally more positive economic news flow.

 “The forward-looking indicators are also proving relatively resilient, although it would not be a surprise if activity slows somewhat ahead of the forthcoming general election.”