LONDON Fast-growing Asia and Latin America are expected to see commercial property rents and values rise in the first quarter of 2011, while the hard-hit U.S. market is showing signs of recovery, a survey said on Tuesday. The Royal Institute of Chartered Surveyors, which polled 410 of its members worldwide, said rental expectations in major markets such as Hong Kong, China, Singapore and Brazil are among the most bullish, while those in Peru are particularly upbeat.
This was in contrast to respondents from Greece, Spain, Ireland and Japan, where most respondents continue to foresee further rental declines, RICS said.
The quarterly survey showed that overall, agents in about three-quarters of the 45 countries represented in the survey reported improved demand from tenants for commercial property in the final three months of last year.
"Solid growth in Asia, Latin America and parts of Eastern Europe is providing significant support for the real estate sector," said Simon Rubinsohn, RICS chief economist, adding this was a key reason for central banks to raise interest rates.
"Even so, our suspicion is that these markets will see the strongest gains in capital values over the course of 2011."
In the United States, more respondents now expect capital values to improve in the first quarter, resulting in a positive swing in investor sentiment in the form of rising investment transactions and number of bidders per property, RICS said.
Rental expectations for U.S. commercial property still remained in negative territory, although this was less than in earlier surveys, it added.
Expectations for the UK market remained largely divided along regional lines, with respondents expecting capital values to rise in London, while expectations remain negative for the rest of the South, Midlands and North, RICS said.
"Prime London offices are, and will continue to be, the most buoyant part of the market. Meanwhile, secondary offices around the country are a particular area of concern as oversupply will be compounded by likely consolidation in the public sector," Rubinsohn said.
(Reporting by Daryl Loo; Editing by Karen Foster)