The amount of commercial property development in the UK fell in July as a result of the ‘credit squeeze’ and ‘falling economic sentiment’, according to research released today by Savills.

The firm said around 40% of developers had indicated a reduction in overall activity compared to one month earlier, while just 6.6% reported a rise. This represented a record low for the survey.

The report said: ‘Private sector development declined at a far steeper pace than public sector activity in July. Anecdotal evidence suggested that the ongoing global credit squeeze and falling economic sentiment were the main factors behind the latest drop in activity.’

Savills said market sentiment remained pessimistic in July, although the degree of negativity was less than in June.

Read the full report below.