Japan Leader in Expectations for Commercial Property Growth: New Survey

Posted on 13 November, 2014 by Jodee Redmond

The results of Quarter 3, 2014 Royal Institution of Chartered Surveyors’ (RICS) Global Commercial Property Monitor have been released, and Japan is on top when it comes to expectations of growth in commercial property values and rents. The survey also found that the UK and New Zealand are close behind, however.

Closeup of a Japanese flag with blue sky

There are improvements in Spain, Portugal and Ireland. France leads in the area of rising investor inquiries, but that has not yet fed through to capital value projections, which are still subdued.

The survey results revealed that there is momentum in Germany, the US, United Arab Emirates and Hungary. Growth in tenant demand was particularly noteworthy.

The medium-term prospects for India are encouraging for the country, with sizeable gains being projected for rents and capital values of approximately 10% per annum over the next three years.

In China, growth in supply of commercial property is outstripping demand in the investment and occupier sectors. This is contributing to a flat short-term outlook for both rents and capital values. For the first time since 2009, OSI and ISI readings have been negative for two consecutive quarters.

South African trends are similar to those in China. Investor interest has gone up over the past three months.

Sentiment in Russia and Brazil is declining across the board. There has been an ongoing situation in Brazil for the past two years with moderating economic growth and higher interest rates taking their toll on the real estate market.

In Russia, approximately three-quarters of those surveyed said that sanctions are affecting business, and half predicted there could be more bad news to come.

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