Commercial property values fall 2%

Commercial property values took a two per cent fall in June, figures from the Investment Property Databank (IPD) show.

Retail property values recorded the highest fall of 2.4 per cent, representing a doubling in the rate since May, when values dropped 1.2 per cent.

However, rental growth in June remained at -0.4 per cent.

"The accelerating downward pressure upon returns still primarily reflects adverse yield adjustments," comments Ian Cullen, IPD co-founder.

"Rental value movement, though negative for the second successive month, remains barely measurable."

On a rolling 12 month basis, the all property total return has now hit a record low at -14.9 per cent, the worst annualised decline since April 1991, when the index showed an -8.1 per cent drop.

Earlier this month research by Atisreal showed that office lettings in central London have slumped by 22 per cent between the first and second quarters of the year.

The vacancy rate in the City of London rose from 6.2 to 6.7 per cent, equating to 4.74 million square feet of office space remaining available.

Martin Slowe Property Services are Commercial Property Consultants offering a full range of Commercial Property Services.