A survey of American and British property professionals published recently reveals that more American property professionals feel that the economic recovery is underway than their British counterparts (60% versus 47% respectively); however, professionals on both sides of the Atlantic agree that there are reasons to be optimistic, with more than three quarters of respondents in both countries agreeing that the economy is either already out of the recession or will be within 12 months. The survey was jointly produced by the Building Owners and Managers Association (BOMA) International and the British Council for Offices, and includes responses from more than 381 property professionals in the U.S. and the U.K.
Despite remaining optimistic about the economic outlook, U.S. property professionals conversely voiced less confidence in the market than their British colleagues. Only 39% of American property professionals reported a rise in demand for office space, with another 26% expecting demand to improve in the next 12 months. Conversely, British professionals described a buoyant market with a total of 78% reporting rising demand for office space or expecting it to come in the next 12 months.
Americans were also more pessimistic about ongoing trends in the commercial real estate industry, with 68% expressing a belief that the current downturn in demand for office space reflects a permanent reset in terms of occupiers using less space per worker; just less than half of British industry professionals agreed with this view.
Property professionals on both sides of the Atlantic believe that rental affordability will be the biggest driver for tenants when deciding where to sign leases over the next five years, reflecting the current pressures on company budgets. Sustainability was ranked more important by British than by Americans, though respondents from both countries expressed that climate change adaptation is more important than climate change mitigation.
“This survey highlights numerous similarities in the tenant drivers in both the British and U.S. commercial real estate markets,” commented Henry H. Chamberlain, APR, CAE, president, BOMA International. “While our nations face different government policies, financial regulations, and cultural factors, both BOMA and BCO memberships agree on several major issues, including when recovery will gain footing, the drivers of demand for office space, the impact of the credit crunch, and the importance of sustainability and transit-oriented development in the future.”
“This latest research from the BCO and our counterparts in the US, BOMA, shows that there is cautious optimism on both sides of the Atlantic, with the British seeing some positive indicators of economic recovery in the property market, despite expressing concerns that the recession is not yet over,” remarked Richard Kauntze, chief executive, the British Council for Offices.
To download a PDF of the complete survey, click this link.