CFI: News Review


National picture hides regional opportunities by


Martin Kearns, head of strategic policy, Tiuta


it has always struck me that it is something of a red her- ring, when talking about the property market in the uK, to bring up “nationwide” comparisons or averages simply because we have a very regional and local mar- ketplace. even when you come


down to individual towns or villages, there are micro- markets within those areas; for example, in one street prices could be on the up, yet the next street over could be seeing price falls. therefore, when you have


such a regional marketplace, to review the country as a whole and provide any sort of coherent analysis, to my mind, seems rather mis- placed. this is not just the case


for the residential market, it is also apparent in the com- mercial sector, perhaps even more pronounced.


Commerce is local the recent uK commercial market Survey from ricS goes some way to revealing the true local nature of this marketplace. We not only have a very pronounced north/South divide at present but even with the South itself there are major shifts and direc- tion changes which mean that London can be set apart from all other areas. it used to be said that


the property market in the South was the forerunner of all others across the country however it might be possible to constrain that idea now. We could say that the


ripple effect of London will filter out into the South east eventually, however there are no guarantees that this spreads any further.


“It is increas- ingly rare for developers to secure all their funding through mainstream means and bridging and development lenders like ourselves are increasingly able to ensure a development goes ahead”


a positive picture down


South no long means that the north is in line to pick up on that positivity some- where in the future.


London… the ricS survey shows that we currently have a


52 mortgage introducer JUNE 2011


commercial market which could best be defined as London and the rest. to say there


are strong re- gional diver- gences seems to be some- thing of an understate- ment.


London certainly outper-


forms all other sectors and regions as the report finds. rental expectations for commercial property in London are increasing at the fastest pace since Q3 2007 and a particularly in- teresting point for brokers to pick up on is that, again in London, new commercial development was also on the up – the only region in the uK where this was the case. and more positive news


for those developments and lending in London comes with the news that capital values remain firm here, however this is not some- thing that the other regions can boast. indeed, across the country outside London capital val- ues are falling while the out- look for rent is slipping back as the number of available commercial properties rises.


…and the rest Having said this ten- ant demand is growing for the second consecu- tive quarter particularly in the office (predominantly South-based) and the indus- trial (predominantly north- based) markets.


therefore it is a mixed


bag in most regions however London shines as a beacon of opportunity at the mo- ment.


indeed with a shortage of


available commercial prop- erties in the capital, those looking at developing here may well be on to a good thing.


Lack of competition the issue as always is fund- ing. indeed, the ricS survey highlights the lack of com- petitively-priced lending as hampering the investment side of the market. So, brokers active in the


capital should be keen to keep all avenues of potential lending open to them and their clients. it is increasingly rare for


developers to secure all their funding through main- stream means and bridging and development lenders like ourselves are increas- ingly able to ensure a devel- opment goes ahead. in this market, lenders


with an appetite to lend are worth their weight in gold and for those brokers who can help make this happen, there are also significant re- wards to be enjoyed.


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