The CBRE Monthly index reported an overall decline in commercial property value for August, with Industrial being the only individual sector reporting a growth.
Capital values fell -0.3% across all UK commercial property last month, while rental values decreased 0.2%. The retail sector reported a -0.8% decline in capital values, brought on by the 1.9% decrease in capital values for shopping centres. Retail rental values declined 0.7%.
In the same month, the office sector reported a 0.1% decrease in capital values. Office rental values fell 0.1%, including in Central London, but outer London offices posted an increase at 0.2%; the only office subsector to report a growth.
The industrial sector was the only sector that had a positive capital value growth with a 0.1% increase, however it is less than the previous month (0.3%). Average sector rental values increased 0.1% and total returns for the industrial sector were 0.5% in August.
Toby Radcliffe, research analyst at CBRE said: “At all property level not much changed in August, rental and capital values are still experiencing small declines with returns remaining marginally positive. However, when we look more closely there are some interesting stories. With a deceleration in the rate of value decline, the office sector could be back on the path towards positive growth, not far behind the industrial sector. Meanwhile, declining values continue within the shopping centre subsector, making a positive end to Q3 seem unlikely for retail.”