The CBRE Retail team knows retail property. Our teams cover retail agency, out of town, shopping centres, lease consultancy and capital markets as well as corporate occupier services, research and consultancy. Based in the west end of London we have an extensive team covering central London retail as well as offices across the rest of the UK specialising in local retail knowledge.
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UK COMMERCIAL REAL ESTATE SET TO DELIVER TOTAL RETURNS OF OVER 19% IN 2014
Total returns for All Property were 1.4% in October, driven by capital value growth of 1.0% over the month.
So far this year capital values have increased by 11.6% and resulted in total return of 17.8% for the last eleven months
All market segments have recorded higher total returns so far in 2014 than in the whole of 2013.
For some time we have expected that rental growth would take over as the main driver of capital value growth in Central London offices. Although yield shift is still an important component, it is notable that the contribution from rents is becoming bigger.
Money originally earmarked for grocery store expansion is being diverted to fund an industry-wide price war as the big-4 seek to protect their market shares.
The grocery pipeline has declined by -4%since its 2012 peak. Some contraction of land banks is expected but the medium term fallout is unclear. Currently, many of the 500+ 50k sq ft in the pipeline appear to have been parked rather than dropped.
The amount of new grocery space under construction has fallen by 20% since end 2013.
The rate of convenience store opening shows no sign yet of declining. Convenience store openings are exacerbating trade diversion from grocery stores.
Shopping centre construction activity remains at recessionary levels with no sign of a broad based development upturn.
The shopping centre pipeline has dropped to the lowest level recorded since H2 2000. The pipeline is on track to contract to circa 40m sq ft by 2016/2017. Just 42.47m sq ft is left in the pipeline currently.
Shopping centre construction levels have lifted marginally but are still at barely 40% of 2007 levels. The low level of shopping centre development activity is resulting in acute shortages of large unit stock in primary markets.
The House of Commons’ Communities and Local Government Committee held an inquiry into the operation of the National Planning Policy Framework (NPPF) during 2014. It published its report on 16 December 2014.
The report identifies a number of significant issues with the operation of the NPPF, but points to the need for adjustment, rather than a complete overhaul, of the document. It concludes that the Government would be ill-advised to consider tearing up the document and starting again, but recommends a number of specific changes.