According to recent findings from the Q1 2018 RICS UK Commercial Market survey, there is an increasing divide between the demands for the retail and industrial sectors. The general trend was the demand for retail space was declining while the demand for industrial grew. Interestingly however, the overall demand in the market was noted as being consistent in Q1.
The survey reported that 31 percent of respondents noted an increase for demand in industrial space, though unfortunately the same cant be said for the retail sector which noted that 43 percent of respondents saw a drop in demand for retail properties. This drop in retail made the demand for the sector the lowest it has been since 2009.
The same split looks likely with rent growth over the coming months. in the retail sector, it is likely that the lack of demand will see a downward pressure on retail rents. Conversely, the rents for industrial units are likely to rise with the increased Q1 demands.
For now, it appears the retail sector is still in a slow downward trend that shows no sign of immediate change. Now it will be interesting to see what the results from the Q2 RICS UK Commercial Market survey show.
