Mixed-use developments are performing better for landlords than single-use schemes, according to research from FPDSavills.
The research overturns conventional wisdom, which has led many developers and funds to oppose retail uses for the ground floors of office and other developments.
The researchers looked at 35 completed development schemes across the UK. In London, the mixed schemes saw average rental growth of 5.2 per cent a year, against just 3.4 per cent for single-use properties.
In the South, the difference was even more pronounced at 4.8 per cent and 2.4 per cent respectively. The Midlands was the only area where single-use properties performed better.
FPDSavills director Yolande Barnes said: 'Rental growth can be an important indicator of occupier demand. It could be that businesses are willing to pay more to move into multi-use buildings. This is despite the popular belief in the property industry that occupiers want their own dedicated building.'
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