Central London shops see near-record levels of rental growth

By

Cajsa Lykke Carlson

Published
Jul 27, 2016

The latest figures from CBRE’s Prime Rent and Yield Monitor for Q2 2016 reveal that rents across the UK’s prime commercial property rose by 1.0% in the period. The increase was driven by near-record levels of rental growth in Central London shops.

In the period, high street shops and industrial rents rose 2.8% and 1.4%, respectively. The greatest rental growth among high street shops was seen in Central London, where rents rose 8.9%. This is a lot higher than the rent increase seen in the rest of the UK, which was just 0.2%.

Retailers are still happy to pay premium rents on sought-after London streets, with a third of the tracked locations in Central London seeing rent increases over the quarter.

Miles Gibson, Head of UK Research at CBRE, said: “The second quarter wasn’t exactly business as usual for the UK’s political and economic landscape, but despite the heightened uncertainty in the run up to the referendum vote, the commercial property sector demonstrated strong underlying health, with yields largely unmoved in core markets.
 
“In particular, ample demand for commercial space pushed up rents nationwide, especially in prime London retail, which saw some of the highest rental growth on record. The capital is open for business, and remains an attractive proposition for occupiers seeking to locate in a world leading global city, and investors and landlords capitalising on this desire."