Business Weekly - Cambridge, UK

According to leading regional property specialists, Barker Storey Matthews, the downturn in the US economy and the gradually extending lead times for letting property has led to prices peaking in the short term and possibly falling in some case.

Mike Sumpster, Marketing Director at Barker Storey Matthews, said developers were already feeling the effects of a slower moving local property market.

“We have seen some major office and R&D developments in the sub-region in recent years and there is still more space coming onto the market,” he said.

“It is not a case of, if the space will be taken, but when.

“However, the general slowdown is having an impact and the recent attack on the United States is likely to exacerbate the problem,” he said.

Barker Storey Matthews have seen a softening of the hi-tech end of the market and put this down, in a number of cases, to US parent corporations and investors putting property decisions on hold, particularly with regard to relocations.

Sumpster added: “Some business and technology parks have successfully let all accommodation but there are cases where ‘lets’ are behind schedule.

“At the same time the next phase of the development is already being marketed.

“Large developers can take a hit in the short term but we will want to see full confidence returning to the market unless we are to witness a more serious problem.”

The effect of this ‘mini’ slowdown is that deals are being done on prices and terms.

“In order to maintain a reasonable momentum and to get companies ‘installed’, prices below the market rate are being offered to keep letting schedules on track,” said Sumpster.

“This is not a good trend and we must hope that the impact the US problems are currently having on our local economy, both direct and in-direct, will not be too serious,” he concluded.