Britain’s commercial property market may be set to enjoy an upturn in fortunes as experts have forecast further growth in the UKs economy.
According to the Ernst & Young ITEM Club, factors such as the fallout from the Japanese earthquake and the bank holiday’s the country enjoyed in April, played a huge role in slowing the economic growth during the second quarter of 2011.
Andrew Goodwin, economic adviser to the Ernst & Young ITEM Club, believes these factors must be considered when trying to explain the ‘disappointing’ growth figures for the period. ‘It’s looking likely that second quarter GDP growth will come in at around 0.3%,’ he commented. Mr Goodwin predicted that ‘greater momentum’ will build up in the economy during the second half of 2011. This, he added, demonstrates that the consequences of earlier one-off events ‘could have been worse.’
Should we see improvements in the UKs economic situation businesses may be more willing to take a risk and expand their operations, which would obviously drive up demand for commercial properties in major towns and cities across Britain.
Earlier this week, CBI and PricewaterhouseCoopers revealed in there quarterly survey that business volumes in the financial services industry increased in Britain during the second quarter of 2011.
According to data from the Royal Institution of Chartered Surveyors (RICS), economic and commercial property conditions in the capital have continued to improve during the last few months.
However, some fear that the UK’s wider commercial property market in the regions is not on the brink of an epic recovery and is merely hanging on to the coattails of the strong London commercial property market. Simon Rubinsohn, an economist at RICS, stated that there is ‘little reason’ to expect this to trigger a similar upturn in other parts of Britain ‘any time soon… Within the capital, it is the office sector which has enjoyed the most pronounced recovery,’ he added.
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