(Image courtesy of the GED Project).
International Businesses Postpone Investing in Britain
International businesses are postponing investment in Britain in the wake of European uncertainty, according to the latest UK Commercial Market Survey by RICS.
International businesses are postponing investment in Britain in the wake of EU uncertainty, according to the latest UK Commercial Market Survey by RICS, with new figures showing demand for UK commercial property among investors stalling as the referendum approaches.
Alarmingly, only 6 per cent of survey respondents say Brexit will have a positive impact on the commercial property sector.
RICS' EU Referendum Paper which examines the pros and cons of the UK remaining and exiting Europe includes new survey data showing that there has been a steady easing in international demand for UK office, industrial and retail property since the referendum was confirmed in Q2 2015.
The demand indicator among international investors for UK commercial property is now at its lowest level since RICS records began in 2014 with just 5 per cent of members surveyed reporting increased interest from overseas companies over the last three months. This is a considerable drop from Q2 2015 when the figure was at 36 per cent.
Uncertainty knocking confidence
Uncertainty caused by the EU referendum has been cited by 38 per cent of RICS members working within the sector as the reason why major international retailers and other businesses have been nervous of investing in Britain.
43 per cent of respondents believed Britain leaving the EU would have a negative impact on the commercial property sector and only six per cent said a Brexit scenario would have a positive impact on the commercial property sector.
The EU Referendum Paper shows that a range of key industries from residential housing to construction and rural have been hit by short term uncertainty. However, across the board, in the longer term steady growth is still predicted across rural, land and built environment sectors.
The RICS Royal Charter requires that the body serves the public’s interest and as such, it will not provide a steer on which way to vote. As such, the EU Referendum Paper, objectively examines various scenarios, but does not take the analysis to the next stage of a ‘stay or go’ conclusion.
Visit www.rics.org for additional information.