INDUSTRY NEWS

Commercial property ‘needs to fall 10%’

Commercial property prices need to fall by ten per cent before buyers take an interest, a leading investor has said.

The director of London & Stanford told the Telegraph newspaper that investors would stay away until prices dropped some more.

Patrick Vaughan said: "We think it should get to the point where commercial property starts to offer value quite quickly but we are not there yet."

The company has released its preliminary full-year results, which showed a loss of £1 million.

However, it is yet to spend the money it raised through its flotation in November last year, the paper reported.

Mr Vaughan explained that because the cost of capital outweighed the return on commercial property, prices had further to fall.

"Since the commencement of trading, we have not yet made any new acquisitions, because we believe that market conditions have yet to reach a level where new investment makes good sense for shareholders," non-executive chairman, Raymond Mould commented.

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