Fewer private sector firms expanding property portfolios

Posted under General by Jermaine

The latest real estate survey by CBI/GVA Grimley Corporate Real Estate shows that many private sector firms were refraining from expanding their property portfolios.

The survey, which involved private sector firms of all sizes and from different regions, highlighted that 24% of the firms are planning to cut their portfolios in coming 6 months.

The survey also revealed that balance +3% increased their holdings in last 6 months which is much slower rate for growth compared to previous +15%.

Retail, leisure, manufacturing and financial services showed wide differences. Retailers’ property holdings rose in last 6 months but no change is expected in the next half, while leisure sector’s modest growth in property holdings is likely to shrink sharply over next 6 months. Financial services and manufacturing services are going to intensify reduction.

80% of the firms which participated in the survey stated that economy downturn and credit squeeze had adverse impact on property holdings.

Half of the respondents to survey informed that surplus holdings had become an issue for them. Retail has 66% surplus, manufacturing 61%, chemicals, extraction and utilities 90% and leisure 64%.

GVA Grimley informed that trend in reducing property holdings is accelerating amid apprehension of significant fall in demand over next 6 months.

Survey also revealed that businesses of half of the firms were affected due to payment of vacant rates, the most affected being engineering and transport firms. 20% of the respondents were considering demolition of vacant properties while 40% were advancing surrender of leases to landlords.

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