Commercial and City property prices crumble following Brexit vote
The extent of damage to commercial property prices caused by the UK vote to quit the European Union will be laid bare this week.
Analysts at UBS Asset Management expect figures from Investment Property Databank to show on Friday that commercial property values fell by four per cent in July with the value of City offices down six per cent.
The vote has yet to drag down residential property prices, with houses across the country edging up slightly in July, according to data released by Nationwide at the end of last month.
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The Royal Institution of Chartered Surveyors will publish its monthly house price survey on Wednesday which economists expect to show similar results.
Following the Brexit vote several property managers put the brakes on their funds, fearing a rush for the exit.
Aberdeen Asset Management suspended trades on its Aberdeen UK Property Fund and the Aberdeen UK Property Feeder Unit Trust to protect the value of the fund for longer-term investors and to give Aberdeen time to dispose of properties to protect liquidity.
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Meanwhile Wealth and Investment has turned its attention away from conventional property investment and towards the likes of GP surgeries, theme parks, hospitals, care homes, and student accommodation.
The wealth management and investment services division of Investec at the tail end of last month that it had redeployed around 20 per cent of its real estate exposure – equating to £200m – from conventional property investments to non-traditional property vehicles.