Is London commercial property on the rise?
Figures today from Great Portland Estates seem to indicate that property values in London may have turned a corner. The company reported a 15.5% increase in net asset value per share and two new acquisitions which would seem to indicate a renewed appetite for London commercial property. So is this the turning point we have been waiting for?
While there's no doubt that commercial property in London is more in demand today than it was six months ago it is also worth remembering that London is effectively a mini economy within the UK economy. That's not to say that London does not direct the UK economy, both higher and lower, but very often changes in the London mini economy may take some time to be replicated across the UK as a whole.
Great Portland Estates also suggested that some of the increase in London commercial property prices can be linked to demand for a smaller base of quality properties which has squeezed prices high. However, it is good that we seem to be moving away from distressed asset sales in London and other areas of the UK and finally there appears to be some light at the end of the tunnel.
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