DEMAND for commercial property in the north fell for the sixth successive quarter at the end of 2020, with a significant increase in the vacancy rates for retail and office space, according to a new survey.
The quarterly commercial market report from the Royal Institute of Chartered Surveyors (RICS) and Ulster Bank, said industrial space is the only sector in Northern Ireland that showed increased demand in the fourth quarter of last year.
The survey also pointed to a continued decrease in investment enquiries.
The findings, based on a survey of property professionals in the north, said the upward trend in vacancy rates for retail and office space had been exacerbated by the response to the Covid-19 pandemic.
RICS said demand for retail and office space continued to fall strongly in the final three months of 2020.
And property professionals see no sign of improvement for retail over the short or longer term, with expectations also downbeat across the office sector.
It follows confirmation that Debenhams will close its four large department stores in Belfast, Newry, Ballymena and Craigavon.
The high street has also been hit by the loss of Eason, DW Sports and Laura Ashley. A number of other fashion chains, including Peacocks and Menary’s, have also embarked on closures.
Meanwhile, stores belonging to the Arcadia Group, such as Topshop, could also soon disappear from the high street if online retailer Asos succeeds in buying several of the failed fashion empire’s brands.
RICS Economist Tarrant Parsons said the results of the survey were unsurprising given the economic impact of the Covid-19 restrictions.
“Both the office and retail sectors continue to see occupier and investor demand diminish, with expectations for rents and capital values remaining deeply negative for the time being.
“Having said that, the industrial sector seems to go from strength to strength. Indeed, supported by more favourable structural dynamics, demand for industrial/logistics space accelerated noticeably over the latest survey period.
“As a result, already positive rental growth projections across the sector were revised higher in the Q4 results.”
Gary Barr from Ulster Bank said the environment remains very challenging for many of the lender’s customers.
“Ulster Bank has therefore lent more than £350 million to Northern Ireland companies through coronavirus support to assist them through the pandemic, and we are continuing to support our customers across all sectors as they deal with the impact of restrictions on their business with appropriate forbearance.”
— to www.irishnews.com
