Oct 17 UK commercial property values slipped in
September but at a slower pace than in July and August, a
closely-watched index showed, suggesting concerns about the
impact of Britain's vote to leave the European Union are easing.
Overall property values for UK commercial assets fell 0.21
percent in September, following a 0.65 percent fall in August,
and 2.8 percent fall in July, the IPD real estate index,
compiled by MSCI, showed on Monday.
Britain's 900 billion pound ($1.12 trillion) commercial
property market was one of the biggest victims of the turmoil
that followed the June referendum, and at one point over 18
billion pounds worth of commercial property funds were
Commercial property deal activity level has since picked up,
as a steep drop in sterling attracts overseas buyers and local
investors remain unfazed by any potential fallout from Brexit.
Most funds have reopened and valuers have dropped Brexit
uncertainty clauses from most of their property valuation
The clause stated there was a reduced probability that
valuers' opinions of the worth of a UK property would exactly
coincide with the price its potential sale fetched.
Valuer Jones Lang LaSalle told Reuters it had removed
the clause as transaction levels picked up, while Savills
said in an email it was using the clause for a more
limited group of commercial asset types than before.
Total returns from UK commercial property rose 0.2 percent
in September, compared with a drop of 0.1 percent in August,
MSCI data showed. Total return is often used to compare
different assets as it takes into account their value as well as
The IPD real estate index is one of Britain's most widely
watched commercial real estate data surveys, and tracks about
10.5 percent of the professionally managed UK property across
all sectors, including retail and office property.
The September index was based on data from 3,258 property
investments with a total capital value of 45.8 billion pounds,
($1 = 0.8042 pounds)
(Reporting by Esha Vaish in Bengaluru; editing by Carolyn Cohn
and Susan Thomas)