Commercial property demand slips

Tenant demand for commercial property dipped in the last quarter of 2007, new research has revealed.

According to research by the Royal Instituted of Chartered Surveyors (Rics), a balance of - 20 per cent of respondents reported a fall in demand in the final three months of last year.

Commenting on the figures, which revealed that the demand in the sector was at its lowest level for five years, Simon Rubinsohn claimed that the market may dip again.

The chief economist of Rics said: "Pessimism regarding the near term economic outlook has started to make serious dents in market sentiment as surveyors start to see the previously strong office sector join the retail market in decline."

He added: "While finance remains scarce, commercial property's continued reliance on capital funding could see the market dip further."

Rics revealed that the retail sector was the most affected, while the industrial sector remained relatively stable.