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Demand for London office space has continued to grow in July, according to the IPD (Investment Property Databank) UK Monthly Index.
Somewhat less positively though, the results displayed the office sector as the only sector experiencing any capital appreciation, despite an ongoing positive growth of two years within the UK market.
Phil Tily, UK and Ireland managing director for IPD said: “With a 0.1 per cent improvement in capital values this month, the balance between the performance of prime assets and the more challenged secondary markets remain finely poised.”
Despite the growth, Tily remained wary though, adding: “Challenges within the wider economy have put further pressure on the market. The declines in the retail sector being a case in point.”
The strong performance and capital growth posted by London offices has meant the overall market has remained at a positive level.
Providing an explanation for the considerably overall lower level of positive growth – the lowest since the recovery began 24 months ago â€“ Tily said: “While the Euro-zone crisis and the American downgrading has led to a lot of talk regarding the UK as a ‘safe haven’, the slowdown in the UK economy has limited levels of growth in this month’s results.”
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