UK prime commercial property rents fell -0.2% in Q2 2019, marking the first decline at the national level since Q3 2012, according to CBRE’s latest Prime Rent and Yield Monitor.
According to the report, the fall in UK prime commercial property rents was driven entirely by the Retail subsectors.
”Our Q2 results are very much a continuation of the trends seen in Q1 2019 with downward pressure from the Retail sectors now pushing All Property rental growth into negative territory. A decline of -0.2% in Q2 is the largest fall in ten years, highlighting the extent to which prime Retail is coming under pressure, both in pricing and rental values,” said Robin Honeyman, Research Analyst at CBRE UK.
At the national level, retail prime rents decreased -1.1% in Q2 2019, a minor acceleration from the -1.0% fall reported in Q1. Shops in Wales reported the largest decrease, reporting a fall of -7.1%. The next biggest fall was -1.5% in Eastern Shops.
Prime rents in the Office sector increased 0.4% in Q2 2019. Overall results were pulled up by Yorkshire & Humberside (3.4%), East Midlands (2.0%), Key Provincial Cities (0.7%), and Central London (0.7%).
Industrial prime rents increased 1.3% in Q2 2019 (Q1: 1.0%). While Industrials in the North West have outperformed for the last four quarters, in Q2 Industrials in the North East took the top spot (2.4%). They were followed closely by Eastern (2.3%) and Yorkshire & Humberside (2.0%) prime Industrials.