Regional property markets still wobbling, Rics claims
The regional office markets held up better than expected in the second quarter of 2012, according to a new report.
Research published by Knight Frank – which studied the commercial property sector across 11 cities – suggested that businesses and organizations are continuing to seek bespoke office space.
Across the study sample, total take-up for Q2 2012 totalled 1,423,646 square feet, up 32 per cent on the previous quarter.
However, the second quarter of 2012 was somewhat skewed by Aberdeen’s record take-up level of 547,926 square feet.
And commenting on the figures, Josh Miller, senior economist at the Royal Institution of Chartered Surveyors (Rics), suggested there is in fact a mixed outlook for the sector.
He claimed that some of the data for the regions may be overly optimistic, as there remains a certain underlying weakness outside the capital.
“Tenant demand continued to decline in many cases at a higher rate and rent expectations outside of London remain quite negative still,” he suggested.
“The indications that we are getting from our survey are that the office markets outside of London do not appear to be strengthening. Conditions still appear to be deteriorating.”
But he claimed there are “bright spots” in the regions, as suggested by the Knight Frank data.
Demand for Manchester office space held up well between April and June, he noted, while other key cities also saw increased demand for commercial tenants.
He suggested that conditions in prime city locations are “a lot better” than those in regional towns across the country, with much of the sector remaining downbeat.