Eurozone crisis ‘hitting British commercial property’October 3rd, 2012 Category: Building Management
The ongoing debt crisis in the eurozone is hitting activity in the UK's commercial property market, experts have stated.
According to the British Institute of Facilities Management (BIFM), the financial turmoil has had a "significant impact" on the sector in recent months.
This, it said, is having a knock-on effect on the wider UK economy, as businesses are becoming cautious with regards to both occupying and investing in commercial property.
"Following the economic crisis over the last few years, there is a general uncertainty about the UK's ability to avoid recession in the future," BIFM observed.
The British Chambers of Commerce (BCC) is equally concerned about the level of business confidence across the UK at the moment.
Indeed, the group believes sentiment has weakened since the beginning of the year, which means firms are far less likely to invest than they were a few months ago.
John Longworth, director-general of the BCC, believes domestic austerity measures are partly behind this development, as is the eurozone crisis.
A lack of access to finance is also proving to be a problem for British firms, he continued, as this is undermining efforts to rebalance the economy more heavily towards exports.
"More needs to be done to stimulate growth alongside continued deficit reduction," Mr Longworth commented.
"We need immediate measures now to support confidence and investment [and] a radical long-term growth plan."
David Kern, chief economist at the BCC, added that the UK's economic performance during the third quarter of the year was "weak and inadequate".
The Office for National Statistics believes the country has been in recession for three quarters in succession.
Mr Kern said that while this view is "too gloomy", the economy has been stagnating for too long. This, he stated, means measures to help businesses fuel a sustainable recovery need to be put in place as a matter of urgency.
The BCC estimates that gross domestic product went up by 0.5 per cent during the third quarter of 2012.