London,
08
November
2017
|
10:44
Europe/London

PROPERTY CAPITAL VALUE GROWTH OF 0.4% IN OCTOBER, BOOSTED BY INDUSTRIALS

Across UK commercial property, capital values increased 0.4% in October 2017, according to the latest CBRE Monthly Index. Once again, the national average was pulled up by the continuing strong performance of the Industrial sector. Rental values increased 0.1% over the month.

Capital values in the UK’s Office sector increased 0.4% in October. Central London, Outer London/M25, and Rest of UK offices all reported capital value increases in line with the national average. However, within Central London there was a divergence between the two submarkets. West End & Midtown reported an increase of 0.6% in capital values while City office capital values fell by -0.1%, the second consecutive month of decreasing capital values. Rental values increased 0.1% across the sector. Central London rental values were flat in October, while the Outer London/M25 and Rest of UK markets reported increases of 0.1% and 0.2% respectively.

The Retail sector recorded capital value growth of 0.1% in October. Retail Warehouses slightly outperformed the other subsectors with growth of 0.2%. Rental values across the Retail sector decreased -0.1% over the month. High Street Shops in the South East outperformed the rest of the sector, reporting rental value growth of 0.2%. Retail Warehouse and Shopping Centre rental values decreased -0.1% and -0.2% respectively.

Industrial capital growth again outperformed the other main sectors in October, increasing 1.1% over the month. South East Industrials slightly outpaced the Rest of UK with an increase of 1.3% compared with 0.9%. Rental value growth in the Industrial sector was 0.4%, with the South East again slightly outperforming the Rest of UK (0.4% and 0.3% respectively).

Miles Gibson, Head of UK Research at CBRE
As it has done throughout 2017 Industrial performance again outpaced the other main sectors. With total returns for the year now at 9.1%, investors can look forward to double digit returns for 2017
Miles Gibson, Head of UK Research at CBRE