March 16, 2017 / 3:02 PM / a year ago

UK commercial property recovery losing steam index shows

(Reuters) - Growth in British commercial property prices slowed for a second month in February, a closely-watched index showed on Thursday, denting a recovery seen in the last quarter of 2016 following Britain’s vote to leave the European Union.

A view of the London skyline shows the City of London financial district, seen from St Paul's Cathedral in London, Britain February 25, 2017. REUTERS/Neil Hall

The value of British commercial property assets grew 0.17 percent in February compared with January, according to MSCI’s (MSCI.N) IPD real estate index, overshadowing largely stable rental growth, with total returns falling to 0.625 percent in February from 0.71 percent in January.

The IPD real estate index is one of Britain’s most widely watched commercial real estate data surveys, and tracks about 10.5 percent of professionally managed British property across all sectors, including retail and office property.

The February index was based on data from 3,046 property investments with a total capital value of 44.6 billion pounds, MSCI said.

Many occupiers have curtailed expansion plans after the Brexit vote, dampening expectations for rents and making buyers and owners more cautious.

Great Portland (GPOR.L) sold the Facebook London headquarters building at a discount, while British Land (BLND.L) managed to secure an above valuation price for the Cheesegrater city office building.

Some financial firms, among the biggest users of office space in London, have warned they could move jobs overseas if they lose their ability to service EU clients from the UK.

($1 = 0.8104 pounds)

Reporting by Esha Vaish in Bengaluru; Editing by Alexander Smith

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