InvBrief – Winter 2017/18

Property investment market – Winter 2017/18

2018 commences on a relatively optimistic note. Provisional GDP growth for 2017 of 1.8% may be the lowest since 2012, but is not as bad as many expected. The consensus view for 2018 is a further mild slowdown with growth of 1.5% expected. Globally the picture is more optimistic, with Eurozone growth at a 10-year high and US and China also showing improving economic figures.

Uncertainties still remain, however. Geopolitical tensions are set to continue and perhaps accelerate, which could lead to increased oil prices, and therefore inflation. Populist politics and the unwinding of quantitative easing in the US might impact financial markets, and of course Brexit negotiations must continue with a satisfactory outcome for Britain remaining far from obvious.

We continue to present a positive outlook for UK commercial property, despite these uncertainties, Occupier markets continue to be resilient and fundamentals remain sound, having not altered over the last six months or so. We believe that the current underlying economic fundamentals in the UK commercial property markets will continue to drive returns in 2018 and 2019.

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