Only half of commercial property professionals believe that the worst of the recession is over
- Date: 21/04/2013
A recent survey conducted by BLP (Building LifePlans), the building defects insurance provider, has found that only half of commercial property professionals believe that we have seen the worst of the recession and that banks lending to more businesses and low interest rates will be the best way to get the commercial property market onto a more secure footing.
When asked whether they agreed with the statement that the worst of the recession is over, 9% of those commercial property professionals surveyed said they strongly agreed and 44% agreed slightly. Twenty nine per cent disagreed slightly and 18% disagreed strongly.
When asked what should be done to get the commercial property market onto a secure footing, 81% felt that the banks needed to start lending more to business and 59% said that continued low interest rates would help to kick start the commercial space. Fifty three per cent thought that a reduction in business rates and taxation would also help.
Interestingly, the results showed that 45% wanted to see conversions of empty buildings for alternative uses with 38% calling for an ease on planning regulations to allow for more commercial developments. Twenty three per cent wanted a bigger focus on high streets and 20% would like to see more ‘Enterprise Zones’ with incentives for businesses to re-locate.
Chris Loerns, Underwriting Director, BLP said: “We’ve seen a surge of optimism in the markets over the last few weeks as the FTSE shrugged off fears of a global recession by reaching its highest level since early 2008. But despite this, the commercial sector is still sitting on the fence and waits to see if in fact we are at the tail-end of this recession, or if the worst is still to come.
“While we are starting to see signs of consumer confidence returning which is good news for retail, the rest of the UK commercial sector still faces a tough environment as more tenant defaults are expected this year. In truth, the commercial sector has struggled for some time as lenders tightened their belts and although the value of properties decreased in many cases, the rents only saw upward movements making it difficult for tenants to keep their businesses above water.”