The ULI/PwC's latest 'Emerging Trends in Real Estate' report is a must-read

The ULI’s annual ‘Emerging Trends in Real Estate’, produced in conjunction with PwC, is always eagerly anticipated by the commercial property community.

This year’s report was presented to the Birmingham property community at a breakfast hosted by PwC.

An audience of 60 was relieved to hear the survey concluded that market sentiment is “cautious but positive”, buoyed by a brighter economic outlook.

Here in the West Midlands, the mood was slightly more bullish, with panellist Laura Shoaf, managing director of Transport for West Midlands, going so far as to say the region has got “its swagger back”.

HS2, a high profile and proactive regional mayor in Andy Street, a new devolution deal and the dual wins of the Commonwealth Games for Birmingham and City of Culture for Coventry have certainly boosted confidence. The demise of Carillion arguably dampened the tone, not least because the construction giant is based in the region and the fact the news is still so raw.

Last year, Brexit was a big theme of the survey. This year, respondents said they were less troubled by it, with many of our Continental neighbours benefiting from a slide in sentiment towards the UK.

This is borne out in the city rankings for investment and development prospects. Out of the 33 European cities scrutinised, the UK failed to make an appearance until 20. Birmingham came in 21st, just behind Manchester at 20, with London clocking in at 27. Both Birmingham and Manchester have, however, improved on last year’s ranking, undoubtedly benefiting from the stock shortages and stellar prices in the capital.

Despite its appearance at the lower end of the table, London remained the most active market in terms of capital investment – more than three times its nearest rival, Berlin. Berlin is one of four German cities in the top 10, consolidating its position as Europe’s safe haven for capital.

The sector with the best investment prospect is logistics facilities, with urban logistics anticipated to be the next big thing. Smaller, edge-of-town warehousing which can fulfil the ‘last mile’ of the delivery chain is the sector to watch.

IM’s Tim Wooldridge, however, said this would be challenging to deliver in the Midlands, given the lack of availability of good sites.

It’s impossible to do justice to the full 80+ page ULI/PwC report here, so I urge you to download a copy from the ULI website:

https://europe.uli.org/wp-content/uploads/sites/127/ULI-Documents/ETRE_2018_FINAL.pdf

It’s a must-read.