Property boss calls the bottom of the commercial slump

The slump in Britain's troubled commercial property sector may finally be bottoming out, the chief executive of the property group Hammerson claimed yesterday. However, John Richards warned that only good quality assets would see a rebound.

"There are clearly signs that the fall in valuations is slowing in some sections of the market," said Mr Richards, right. "The lead indicators of that, which are the companies' share prices, show that for those groups with prime property, income is proving to be robust."

Mr Richards added that it might take until the third quarter of the year for prices begin to rise again, but that those companies with what he described as "poor quality assets and poor tenants" might experience a "double dip".

Commercial property values in Britain have fallen by 44 per cent since the market's peak in June 2007. Hammerson raised £584m through a rights issue in March to avoid breaching its loan covenants, while its shares have lost 48 per cent of their value in the past year alone. The comments by Mr Richards follow last week's declaration from Taylor Wimpey, one of the UK's biggest house builders, that the housing market would recover before the end of the year.