Development drops at fastest rate for over two years - decline steepest in London and the South-east
Commercial development activity at the end of 2011 fell at its fastest rate in nearly two years, driven by a sharp decline in activity in London and the South-east, new analysis has revealed.
Development activity nationwide fell 18% in December, coming after a 15% decline in the month before, according to analysis from property agency Savills. The agency said it had not recorded a decline this steep since February 2009.
The South-east experienced the most drastic change of fortunes falling 12% in December, compared with a flat November.
Meanwhile, London activity fell 10% after having been the only region to grow between July and September 2011.
Michael Pillow, head of building consultancy at Savills, said: “Lower-risk and more fundable projects are going to remain most popular until economic growth becomes more dependable.”
The survey also found developers pessimistic about the outlook for the next three months with the index of sentiment scoring -7.
However, they were less pessimistic than in November when the index scored -14.