Published on : Tue, 03 May 2005 00:00GMT
by : Andy Clarke

In spite of a dreary retail market, an upsurge in the demand for commercial business property was noticed yet again in the sixth quarter in continuity with the last five quarters.

A report by the Royal Institution of Chartered Surveyors (RICS) stated that a consistent rise in demand for business property caused chartered surveyors, who operated on commercial property, to expect further rent rises to hit a four year high. Precisely, 13% of chartered surveyors were seen speculating a rise in rents against 9% of surveyors last year in the fourth quarter.

Meanwhile, the amount of vacant commercial spaces declined at a fast pace like in the year 2000, granting landlords some additional power to bargain and rake some money. Even though surveyors were seen offering low value inducements to tenants after four years, the present commercial market still appeared conducive for tenants.

RICS vice president, Graham Chase commented on the market scenario saying, “There is a change in the power base in the high street. The current market is one which exposes poor retail practice but allows those at the cutting edge to gain market share. This is encouraging news for investors who have entered the market in recent years. However, the outlook for the commercial property market is for steady financial returns over the next two years rather than the heady price appreciation of 2004.”