5 trends to expect from the commercial property market in 2015

2014 was a great year for the commercial property market in the UK, with many commercial agents reporting a year full of activity and positivity. With the market still enjoying a certain momentum, here are five trends that we can expect to see in 2015.

Steady growth – After returns of around 20% last year, the market is expected to be more sustainable in 2015, with total returns remaining in double figures, and rental growth making larger contribution. Office and industrial markets should continue to lead the way, as the market has another positive year.

Shortage of prime units – In 2014 we spoke to several agents who predicted a shortage of certain properties in the future and this is certainly something that could emerge in 2015. In particular, Grade A office space and industrial units are proving to be in high demand, with available space running out. Lack of development of these prime units could result in growth for the secondary market.

Uncertain retail sector – Having lagged behind the office and industrial markets in 2014, there is nothing to suggest that things will be any different over the next year. However, the rise of click-and-collect services, as well as a growing population and the rise of destination retail areas means that footfall could well be up in 2015. How this affects rents and the performance of the sector remains to be seen.

Election causing caution – Despite the general optimism surrounding the market, the General Election in May is looming large and causing caution amongst many in the industry. With the outcome unclear, we will have to wait to find out if there will be any serious implications for the commercial property industry.

Regions come to life – London steamed ahead as the market boomed in 2014, but this should radiate out to the regions in 2015. The capital will remain strong, but as supply for space shortens, occupiers will be increasingly looking to other areas for property. What’s more, with the push for increased devolution and government plans to create a northern powerhouse (Liverpool-Manchester-Leeds), the future is looking bright for the rest of the country.

What are your thoughts on the commercial property market in 2015? Disagree with any of the above? Leave a comment and let us know