United Kingdom Real Estate Report Q2 2013

This United Kingdom Real Estate report examines the commercial office, retail, industrial and construction
segments. With a focus on the principal cities of London, Manchester and Glasgow, the report covers the
rental market performance in terms of rates and yields over the past 18 months and examines how best to
maximise returns in the commercial real estate market, while minimising investment risk and exploring the
impact of a variety of factors weighing heavily on the UK’s real estate market.
The commercial sector is under pressure as a result of the country’s economic woes, though it has been
more stable than expected. Activity in commercial property has been very slow as businesses and landlords
watch and wait for signs of economic recovery. The office space sub-sector is a stable element of the
segment, with office space in central London experiencing a healthy run of growth. This now looks to be
slowing, but we expect growth to remain positive, as the capital has limited scope for new development and
demand has moved faster than new supply. New retail developments (larger shopping malls) and fierce
competition for high-end retail space in central London are the key growth areas, with other retail spaces as
well as industrial and office spaces showing slower growth rates in the face of broader economic weakness
in the UK.