U.K. Commercial Property Slumps By Record, IPD Says

U.K. commercial real estate values slumped by a record amount in October in the wake of the global financial crisis, according to Investment Property Databank Ltd.

The value of shops, offices and warehouses plunged 4.3 percent last month, the most since IPD started measuring returns in 1986, the London-based researcher in a statement on its Web site.

``It remains to be seen whether values have now fallen to a point where equity investors are prepared to step back into the market in any force,'' Malcolm Frodsham, IPD research director, said in the statement. ``So rapid have been the falls it is possible that the asset price deflation has run its course.''

U.K. commercial property prices have fallen 28 percent since peaking in June last year, according to IPD, as banks have made transactions harder and more expensive to finance, while companies are firing workers as the economy shrinks, crimping demand for offices and shops.

Investors lost a total of 3.8 percent in October after taking rental income into account. That was slightly bigger than the 3.7 percent loss in December last year.

Shop prices declined 4.7 percent last month, more than the 4.3 percent drop in office values and the 3.2 percent fall in industrial properties.