UK PROPERTY CAPITAL VALUES INCREASE 0.1% IN APRIL, BOOSTED AGAIN BY INDUSTRIALS
Capital values increased 0.1% across UK commercial property in April 2018, according to the latest CBRE Monthly Index. Rental values were flat over the month.
The Industrial sector again provided a boost to overall results in April 2018. Capital values increased 0.7% over the month, with both the South East and Rest of UK markets performing roughly in line with the sector average. The Industrial sector also outperformed in terms of rental value growth with an increase of 0.2%.
Office capital values increased 0.2% over the last month. Capital values in Central London Offices were flat in April, outpaced by growth in both the Outer London/M25 (0.1%) and Rest of UK (0.4%) markets. Rental values were flat across all submarkets.
The Retail sector recorded capital values decreasing -0.3% in April, with the sector average pulled down by a fall of -0.8% in Shopping Centres. With the exception of South East Shops where capital values were flat, all Retail subsectors reported falls in capital values. Rental values fell -0.1% across the Retail sector, again pulled down by Shopping Centres (-0.4%).
At the All Property level, April reported the lowest monthly capital growth since October 2016. Although this is only one month’s result, it could be an indication that investors will need to get used to income driven returns for the time being.