In 2016, Brexit firmly cemented itself as both a word in our collective vernacular, and a concept that touched on just about every aspect of our daily lives – from the NHS to the economy, the news cycle, even arguments around the family dinner table. For better or worse, Brexit, it seems, is here to stay for a long time to come.
And now, a little over six months after the referendum result was announced, British Prime Minister Theresa May has finally laid her cards on the table, speaking publicly about her willingness to take a hard Brexit and to leave the single market. As a result, we’re starting to hear a new term bubbling to the surface: Brexodus.
Brexodus refers to the fear that skilled workers, businesses and industries will flee the United Kingdom as a result of Brexit, either relocating to Britain or to other more attractive business destinations around the world. It’s a word that conjures up images of London’s Canary Wharf with tumbleweed blowing through the streets. But is it all gloom and doom?
Is Brexit having an effect on London’s Commercial Property Market?
Brexit has certainly brought a great deal of uncertainty with it, but change always comes with a certain degree of risk. While there are large question marks hanging over Britain’s trade, growth, investment and economy, the world of domestic and commercial property is still going strong.
Lower interest rates are helping the UK commercial property market to boom and there are plenty of investors and developers searching for properties. Despite the black cloud of Brexit, we’re yet to see any major downturns just yet.
A 2016 survey from the Investment Property Forum found that capital values for commercial real estate were expected to drop by 4.1% by the end of 2016 and by a further 3.6% in 2017. However, rents are generally expected to hold their value, and the drop in the pound has boosted overseas appetite in UK real estate. Colliers International believe that 2017 investment volumes will surpass 2016 levels.
According to the Financial Times, agents predict more demand for warehouses, which are a high-performing investment due to the business needs of online retailers. Savills’ analysts say that this sector is likely to “continue to outperform the rest of the market”.
We’re certainly living in interesting times and so it pays to work with an experienced agent. If you are a commercial property owner who is looking to sell, please contact TA Property, as we have a number of investors and private buyers who are currently searching. And likewise, if you’re looking to buy a commercial property in the London and Essex region, you can rely on us to search, negotiate and secure the ideal premises which will enable your business to flourish.