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Commercial Property Still Feeling Effect of Recession

[ Posted December 28th, 2009 ]

The British Property Federation has recently declared that commercial property throughout the UK is still feeling some of the effects of the recession, as director of policy Ian Fletcher states that commercial lots were late to feel the effects however will also be late in recovering from them. As a result many retail occupiers of commercial space are beginning to go out of business, adding additional strain to the commercial property sector as the rest of the economy is just beginning to recover from record lows earlier this year.

This trend is paralleled by virtually all commercial property throughout Europe, as investment revenue has dropped approximately 40% over 2008 numbers for both the continent and the isles. For many owners and investors this has meant bad news since October 2007 when the economic recession first hit full-swing, however this could also mean potential opportunities for those looking at the other end of the spectrum.

With prices continuing to fluctuate across the UK commercial property board this could open up many doors for new ventures as older businesses that once held key commercial space are closing down permanently. Given a condition such as now where the UK’s commercial property investments are the top in Europe – accounting for nearly 38% of all direct investments in commercial land with a grand total of 25 billion Euros in 2008 – and many investors are overly focused on some particular main available locations the current trend may open up new investment doors that may not have been available just a few short months previously.

Along with the fluctuating markets also anticipate banks to be offering better mortgage rates to investors in order to stimulate the economy and encourage a positive trend in 2010, especially in the commercial real estate sector in order to allow for businesses to maintain some strength as the economy is beginning to recover. Be on the lookout for beneficial fixed mortgages as well, as these may be quite positive in the early 2010.

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