| India's Performance A Reason For Cheer |
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| Market News - Business News | |
| Written by Mediabharti Syndication Service | |
| Saturday, 01 August 2009 | |
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New Delhi (India): Royal Institution of Chartered Surveyors (RICS) Global Commercial Property Survey has revealed that despite some improvement in the economic data and a moderation in the pace of decline in capital values in all world regions, rental expectations deteriorated further. In the second quarter of the year RICS reported the sharpest declines in global commercial property rents in the survey’s five year history, with Singapore, Ukraine, Spain and Ireland leading the way. Surveyor sentiment in Spain and Ireland remained depressed with 97 percent more Chartered Surveyors in both countries reporting a fall than a rise in rents. Surveyors in Singapore and the Ukraine were unanimous that rents have fallen with the net balances in both countries reaching 100 percent. Notwithstanding continuing attempts by agents to offer more attractive inducements, forward looking rental sentiment remains pessimistic. Chartered Surveyors in Italy, Spain and Ireland remain particularly downbeat about the outlook for rents. 97 percent of surveyors in both Ireland and Spain expect rents to continue to fall rather than rise over the next quarter while Surveyors in Croatia and Singapore are unanimous that rents will fall. RICS chief economist, Simon Rubinsohn "Higher yields may be starting to attract interest particularly in economies such as the UK and Hong Kong where prices have already corrected significantly and borrowing and saving rates are at historic lows."
The decline in capital values eased during the second quarter driven by more modest falls in some emerging markets with China and India out in front. Eight percent more surveyors reported a fall than a rise in capital values in China, up from 49 percent in the first quarter. However, the most stunning improvement was found in Hong Kong where the net balance actually turned positive. 57 percent more Chartered Surveyors reported a rise than a fall in capital values up from a negative balance of 81 percent. More generally, expectations for further price rises remain bleak with North America presenting the gloomiest picture. Commenting on the survey results Sachin Sandhir, Managing Director & Country Head, RICS, India said, “The emerging Asia region was the best performing area in the latest global property survey from RICS with India at the forefront. Tenant demand rose for the first time in 18 months with the office market outperforming the industrial and retails sectors. Enquiries to occupy business space are now rising offering near term hope that ongoing strengthening will continue into Q3. Furthermore, agents were less pessimistic on the rental outlook indicating that the pace of decline in rents may ease in the coming months. The improved outlook has filtered into price expectations with only modest falls in values anticipated in Q3.” Simon Rubinsohn further added, “In emerging markets, those countries tied into Chinese trade relationships appear to be weathering the storm better than most with parts of Latin America and Africa including Mauritius, Nigeria and Ghana holding up relatively well. Emerging Asia in particular stands out as the regional out-performer with a marked slowdown in the pace of rental declines and tenant demand in China and India rising for the first time since 2008.”
While transaction activity continued to drop in most world markets, a few countries saw an increase in investment bidders per property. The UK was particularly notable in this regard reporting a positive balance of 46 percent more Chartered Surveyors seeing an increase in bidders. |
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