UK - Property investments in the City of London are set to come under further pressure as falling demand hits rents, Standard Life Investments claims.
The fund manager said take-up of property space during the first six months of this year represented just 25% of average annual demand over the last 10 years.
SLI said the City market was particularly sensitive to stock market declines due to the strong relationship between business investment and City office rental growth.
The problem had been exacerbated by the low level of merger and acquisition activity and had dashed hopes of a strong rebound in corporate spending.
SLI chief investment officer Keith Skeoch said: “Despite the cranes on the horizon, there is little evidence of a boom in the City. Instead, the future of the market hinges on stability in stock markets and renewed corporate expansion.”
Currently six million square feet of space is under construction in the City – but half is speculative.
Developments covering a total of 2.4 million square feet are expected to be completed next year.
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers