2018 forecast to be a strong year for UK commercial property

A new study suggests that 2018 will be another bumper year for UK commercial property.

Prominent real estate group Colliers International has estimated that transaction volumes will remain strong, after data revealed that sales soared to £55 billion in 2017.

According to their data, transaction volumes have not dipped below £50 billion for the past five years – a trend which the group believes will continue into the New Year.

Colliers International estimates that industrial assets will perform particularly well over the course of 2018.

Its report adds that warehouses mixed-use developments are also likely to perform well, offering “attractive, stable returns for investors.”

It notes that the relatively weak value of sterling continues to attract investors from overseas – and that this trend will continue in the run-up to Britain’s departure from the European Union (EU) and beyond.

Tony Horrell, UK Chief Executive at Colliers International, said: “With sterling likely to remain competitive against the US dollar, further new entrants, particularly from Asia, are expected to enter UK market, attracted by buy-side currency plays.

“Property performance is likely to moderate in 2018 as pricing remains pressured and rental growth modest, but on the up-side, the market will become less volatile, offering attractive, stable returns for investors,” he said.

Traditional office spaces and high-rise, mixed-use developments were cited in the report among those likely to remain popular in the UK market this year, particularly thanks to the emerging trend of ‘flexible working’ spaces in cities such as London.