Graham Chase, commercial property spokesman, said: "The economy looks to be in robust shape and large numbers of new and newly expanding businesses are looking for the right premises. Instead they are having to settle for second-best. The new commercial developments becoming available are being snapped up, but there are simply not enough of them." He added: "As in the wider economy, in property we are in danger of repeating the boom and bust cycles of the past, in which buildings planned in response to a commercial boom come on stream just as the economy takes a downturn."
The commercial property market faces overheating as demand for prime office, industrial and retail space threatens to outstrip supply, mirroring the bottleneck in the housing sector, according to the Royal Institute of Chartered Surveyors. RICS said there had not been enough new developments to satisfy demand for prime property nor was there an adequate supply of planned space in the pipeline.