The commercial property monitor from the Royal Institution of Chartered Surveyors (RICS) said occupier demand had risen for the second quarter in a row between April and June.
But industrial property was outperforming other sub-sectors, with office and retail rents both under pressure.
News Catch Up – Wednesday 30th July
According to RICS, a net balance of 10% of its surveyor members reported a rise in overall occupier demand – the highest percentage since 2022, and up from 6% in the first quarter.
And a net balance of 40% of respondents said demand in the industrial subsector had increased in the quarter.
However, demand for office space was reported to be flat, and a net balance of -10% said demand for retail had fallen.
Overall, rents were expected to increase – particularly in the industrial sector, with a net balance of 70% of respondents anticipating a rise in the next three months.
But rents for both office and retail were tipped to fall – with office space rents predicted to drop more sharply.
And respondents were cautious when it came to the prospect of capital values going up in the next three months, with more optimism for the industrial sector than in others.
Garrett O’Hare
Photo by Kelvin Boyes / Press Eye.
Garrett O’Hare, RICS NI commercial property spokesperson and managing director of agency Bradley NI, said: “The commercial property market in Northern Ireland has faced turbulence in recent years, but it is encouraging to see the report noting that surveyors across NI are reporting a rise in overall occupier demand.
“With increases in national insurance earlier this year, inflation continuing to be a challenge for many businesses, and wider structural changes in the sector, it is unsurprising to see that demand for retail space remains subdued.
“Whilst the outlook on rent expectations looks more promising overall, we are cautious when it comes to the outlook of capital values as the sector continues to navigate the many challenges it is facing.”