The quarter saw a 1% increase in All Property rental values, which is just over half of last quarter's increase. Over the year, inflation-adjusted rental value growth was 2.3%, which represents the third consecutive rise in the real annual growth rate.
As in the previous quarter, Retail rental value growth occurred in every region. East Anglia showed an exceptional 3.3% increase, largely due to a 10% increase in Norwich's rents. Central London's rental value growth is slowing as the last two quarter's increases have been below the annual average.
Although the Office sector's growth rate was still higher than either Retail or Industrial, it was nearly half of the previous quarter's rate. London continues to provide the main engine for growth, with areas outside the Southern area, aside from Wales, providing only marginal growth at best. Indeed, Scotland returned a sizeable decrease over the year, with only Glasgow & East Kilbride achieving an increase. Furthermore, Scotland's quarterly change was the region's largest decrease since 1990.
The Industrial sector's rents continue to produce the lowest growth of the three sectors. As in the previous quarter, Wales achieved the highest annual growth. Scotland continues to return decreases on annual figures, as in the previous three periods of analysis. However, over the whole five-year period, Scotland is the only region to achieve an increase in rental values, having suffered least in the recession.
AMENDMENTS TO DATA
There has been a reappraisal of historic data. The areas affected are All Property (Nov 94 to May 96), All Offices (Aug 94 to May 96), All Industrial (Nov 94, Aug 95, Nov 95 & May 96). Retail: West Midlands (Aug 95 to May 96), Offices: West End (Aug 94 to May 96), Holborn & Marylebone (Nov 94 to May 96), Suburban London (Feb 96 to May 96), Central City (May 96), Fringe City (May 96), Central London (Nov 94 to May 96) and London (Nov 94 to May 96). Industrial: Wales (May 94 to May 96). A list of these changes will be published in the near future. In the meantime, please contact Investment Research should you require the updated figures.
RENT INDEX - CURRENT PRICES
% Change
Qtr Annual pa
Feb May Aug May-Aug Aug -Aug Aug -Aug
96 96 96 96 96 95 96 91 96
All Property 408 415 420 1.0 4.5 -2.3
Shops 564 569 574 0.9 3.1 -0.5
Offices 321 331 336 1.7 7.3 -3.6
Industrials 340 343 344 0.3 1.2 -2.5
Equity Dividend 667 690 709 2.8 10.3 7.0
RENT INDEX -REAL TERMS
Movement
Qtr Annual pa
Feb May Aug May -Aug Aug -Aug Aug - Aug
96 96 96 96 96 95 96 91 96
All Property 125 125 126 0.8 2.3 -4.9
Shops 172 172 173 0.7 1.0 -3.1
Offices 98 100 101 1.5 4.9 -6.1
Industrials 104 104 104 0.1 -0.4 -5.0
Equity Dividend 205 208 213 2.6 7.8 4.2
% Change
Qtr Qtr Annual pa
Feb May Aug Feb 96 May 96 Aug 95 Aug 91
96 96 96 May 96 Aug 96 Aug 96 Aug 96
SHOPS BY REGION
All Shops 564 569 574 1.0 0.9 3.1 -0.5
Central London * 558 566 576 1.5 1.7 10.3 3.4
Inner Suburban
London 473 477 481 0.9 0.9 4.5 -1.7
Outer Suburban
London 503 511 512 1.6 0.2 3.3 -1.7
Suburban London
(Agg) 491 498 500 1.5 0.4 3.7 -1.7
London (Agg) 529 537 542 1.5 1.0 6.5 0.4
South East 571 577 581 0.9 0.8 2.1 -1.6
South West 555 559 563 0.7 0.6 2.6 -0.5
East Anglia 717 720 744 0.4 3.3 3.9 -0.1
East Midlands 455 455 462 0.1 1.4 2.6 -1.6
West Midlands 708 717 725 1.2 1.2 2.3 -1.0
Wales 733 735 741 0.2 0.8 0.2 -0.6
North West 561 571 576 1.8 0.9 4.4 2.4
Yorks & Humber 477 482 489 1.2 1.3 4.6 -0.8
North 576 579 582 0.5 0.5 3.4 0.4
Scotland* 521 526 527 1.0 0.3 4.1 1.9
*9.14m (30ft) Zone A. All other regions 6.1m (20ft) Zone A.
OFFICES BY REGION
All Offices 321 331 336 3.2 1.7 7.3 -3.6
West End 434 455 467 4.7 2.8 15.1 -5.4
Holborn &
Marylebone 326 338 358 3.7 6.0 15.9 -7.4
Central City 274 296 305 8.2 2.8 11.2 -2.5
Fringe City 285 289 289 1.4 0.0 1.4 -6.7
Central London 331 349 359 5.3 2.9 11.6 -4.6
Suburban London 295 299 303 1.3 1.3 4.0 -3.5
London 317 331 340 4.6 2.7 10.3 -4.3
South East 335 338 342 0.8 1.3 4.5 -3.4
South West 596 602 611 1.1 1.5 0.7 -2.7
East Anglia 316 316 316 0.0 0.0 -1.2 -4.4
East Midlands 363 363 363 0.0 0.0 1.3 -1.5
West Midlands 705 705 705 0.0 0.0 1.5 -2.6
Wales 417 432 435 3.6 0.8 4.4 -0.9
North West 458 459 460 0.2 0.3 1.4 -0.5
Yorks & Humber 372 372 372 0.0 0.0 -1.4 0.1
North 269 269 269 0.0 0.0 1.4 -0.0
Scotland 454 450 429 -0.9 -4.7 -6.1 -0.9
INDUSTRIALS BY REGION
All Industrials 340 343 344 0.8 0.3 1.2 -2.5
London 369 369 371 0.0 0.6 0.4 -3.4
South East 400 406 406 1.6 0.0 1.8 -3.0
South West 396 396 400 0.0 0.9 0.2 -1.9
East Anglia 369 369 369 0.0 0.0 0.0 -4.2
East Midlands 374 379 379 1.5 0.0 3.0 -1.7
West Midlands 354 354 357 0.0 0.9 1.9 -0.1
Wales 314 314 321 0.0 2.5 5.1 0.2
North West 318 315 315 -0.8 -0.1 -0.9 -2.6
Yorks & Humber 254 259 263 2.1 1.3 3.9 -1.2
North 253 253 253 0.0 0.0 0.0 0.1
Scotland 293 293 292 0.0 -0.5 -1.1 5.1
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
For further information please contact Alan Patterson on 0171 629 7666 extension 2376, or write to him at Hillier Parker, 77 Grosvenor Street, London W1A 2BT.
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