Hope for UK Commercial Property

The CB Richard Ellis monthly index of commercial property returns continues to bring hope of recovery within the sector. Overall the sector posted growth of 0.7% in May, capitalising on the 0.6% growth seen in April. Across the UK the picture is mixed. Within the capital returns for office accommodation rose by 1% against a fall of 0.5% over the rest of the country. Retail properties also strengthened in with an overall return rise of 0.7%. Industrial property continues to lag behind the other commercial property sectors, albeit slightly, with a return of 0.5% against 0.6% in the previous month.

Commenting on the results, Nick Parker of CB Richard Ellis commented that “What investors are increasingly finding attractive about offices in Central London is not just the income security afforded by large occupiers, but also that rents are enjoying significant uplift due to a combination of increasing demand for space and a restricted supply following the downturn.” However across the rest of the country demand is expected to continue to be patchy for some time to come.

Choosing commercial property to lease or buy can be a game of compromise. The choice of manufacturing premises may be defined by logistics and potential workforce whilst retail premises need to be in areas which will attract customers. Cheaper properties may therefore look good initially but turn out not to be the best long term cost/income effective solution. This means that the lower stamp duty land tax (SDLT) rates applicable to disadvantaged areas might not always provide the intended boost to commercial development. This is particularly true if SDLT on commercial property transactions can be mitigated

As tax mitigation specialists Newshams are able to give advice on SDLT and other taxes, how tax may affect any private or business transaction and how to put in place an effective mitigation strategy.

Contact us now on 020 7470 8820 and ask to speak to a tax adviser about how we can reduce the tax costs on your property transaction or e-mail us at enquiries@newshams.com and we’ll get straight back to you.


10th June 2011

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