Commercial property "will not crash" - commercial mortgages

12 July 2007

The commercial property market in the UK is not set to crash in spite of downbeat predictions from some quarters, it has been advised.

A senior figure at New Star Asset Management has said that the current climate of higher interest rates would not present an insurmountable barrier, but rather part of a natural cycle.

Speaking to Reuters, New Star head of global property Stuart Webster noted that the fund''s own move from a "bid" pricing to an "offer" basis was only a short-term move.

"Everyone is forecasting doom and gloom for property ... Commercial property gets peaks and troughs. If interest rates have gone up, then it is a challenge, but inflation is positive for real estate," Mr Webster told the news agency.

"We don''t expect property to crash," he added, in a boost to those with commercial mortgages.

Last week research from Property Data found that investment in UK commercial real estate exceeded £27 billion in the first half of the year.