UK commercial property values declined by 2% during the first half of 2012 as the country fell back into mild recession.
Regional shopping centres suffered the largest decline in the first six months, falling by 6.3%, followed by high street retail outside of the South East, which dropped by 5.2%, while central London retail improved by 2%.
Offices outside of the South East saw 4.8% wiped off their value, while central London offices continued on their upward trajectory, recording growth of 1.8% in the year to the end of June.
Performance over the first half was marred by austerity measures at home and political wrangling in the eurozone, which continued to stifle growth outside of London.
A further fall in values was recorded in June when the value of UK commercial property lost a further 0.5% – the same as May – although total returns remained positive at 0.1%.
Rental growth was flat at 10.6% for the month as occupier demand remained lacklustre.
In the past six months, average rents fell by only -0.1% at the all-property level, although retail saw rents fall by 0.4%.
