Commercial development activity has plunged by almost a quarter in the UK in January, according to a new survey.
Around 23% of commercial developers reported a fall in total activity in January, according to Savills latest commercial development activity report.
Most of the developers attributed the slowdown to deteriorating confidence in the economic climate.
The Total Commercial Development Activity index, a net balance used to provide a measure of overall activity in the UK commercial property sector – registered -14.5%, only just above December’s record low of -15.4%.
Developers were also pessimistic about the future, with the continuation of the credit crunch and the added burden of empty rates from 1 April cited as factors.
The Future Activity Index fell to -23.6% this month, from -22.0% in December – the lowest level since the report began in 2003.
Mat Oakley, head of Savills commercial research department, said: ‘While investor confidence has picked up over the last month, this has clearly not filtered through to developers yet! As capital values begin to plateau and the relationship to the cost of money becomes more realistic, we expect developers’ confidence and then activity to begin to improve.’