UK commercial real estate (CRE) valuations are languishing at post-COVID lows, amid fears the sector faces “banking covenants being breached” and struggles with regard to occupancy. In this short article, we draw upon new Toscafund research which simply dismisses all such concerns.
From the occupational standpoint, in the years ahead, rising employment across a range of diverse well-spread UK sectors will impressively lift the take-up of related CRE, particularly across Central and Northern England (CaNE). Regarding the investment market, with the UK’s monetary landscape having calmed significantly, albeit being spooked again more recently, and occupational demand having held up against all that was thrown at it through 2022, there is now such visibility ahead to draw capital into the elevated yields created by unjustifiably cautious valuations.
