RobertNoel warned that Britain's exitfrom the European Union will lead to a "sustained shock" for realestate demand in the capital, London's FinancialTimes reported.
Hesaid the immediate results would include a "drop-off" in demand inLondon, and a tenants' market will emerge due to decreases in both rents andvalues. Noel added that he is unsure of the impact a potential will have on London'scommercial property market in the long term, according to the report.
CEO ChrisGrigg also expressed concerns regarding an anticipated weak office demand inLondon, particularly in Canary Wharf, in the event of Britain leaving theEuropean Union.
U.K.commercial property investments have slowed considerably since the start of2016 amidst marketuncertainty surrounding the outcome of the June 23 referendum. According toLambert Smith Hampton, investments in central London offices decreased 52% to£2.2 billion in the first quarter from £4.6 billion in the last quarter of2015. The overall drop in U.K. commercial property investments was 27%.
Accordingto figures from Numis Securities, Land Securities and British Land are bothtrading at more than 25% discounts to NAV, the report said.