Commercial property and office space are on the up while retail could be set for a new revival. In this blog post the team at Experience Invest are taking a considered look at a recent new report by Knight Frank.
The report on the June market outlook explains that all property experienced capital growth in May and that office space saw the highest capital growth at 1.5%, with retail the lowest at 0.2%. Even though the figure for retail is low, it’s still encouraging that in the face of the always present threat of internet shopping that retail is showing some growth and may be primed for a small revival.
Internet priced in
The impact of internet shopping on the retail property sector has been well documented over the past five years. Yet, at this time, much of the retail property market now already has technological changes to our shopping habits priced in. New retail services like click and collect have the potential to swing back shoppers in favour of the high street.
Indeed many commentators now feel that retail is in its best position for some time. James Roberts one of economists behind the report said: “Possibly investors now view the internet effect as priced in, taking some of the heat out of the market. This is perhaps a healthy downwards gear change, especially as the internet is no longer expanding its market share in retail as aggressively as a few years ago.”
Vacancies in retail property have hovered around 13% according to most sources. This figure could be set to drop as the boom in online shopping levels out. Intelligent investors will be looking at growth in office and industrial property and wondering when, and if, the true return of the retail property boom will come. Of course, the market has changed, but there is some evidence to now suggest that the pendulum may have started to swing back towards high street retail shopping.
Experience Invest have been trading since 2004 and we’ve worked with all types of investors from first timers to high-NET-worth individuals and corporate clients. As market leaders in UK residential investments, we specialise in high demand, high yield property investments. For more information, or to discuss your own investments needs please contact Experience Invest.