The UK has seen its sixth consecutive quarterly decline in office space availability though office and industrial sector rents are expected to rise at the fastest rate since 1998 over next quarter, the latest RICS commercial property survey has revealed.

A third (32 per cent) of surveyors across the UK said availability across office, retail and industrial properties had fallen, while demand had risen to a net balance of 44 per cent.

This mirrored the situation in Scotland, where the commercial market remained relatively flat (-3 per cent net balance).

Significantly in Scotland, the demand for industrial property rose, but availability fell sharply, with 50 per cent more surveyors in Scotland reporting a decrease in availability. This compares to the national picture, where demand for industrial property grew on the previous quarter (from a net balance of 49 per cent in Q2 to 56 per cent in Q3).

The picture across the UK appears increasingly upbeat, with the firmer tone spreading beyond the London as the economic expansion gains greater grip. Surveyors in London also saw a large rise in prospective overseas investors in the industrial sector (73 per cent) and rental expectations moved into positive territory in all parts of the country, although retail remains something of a laggard, with a flatter rental trend away from the more dynamic parts of the market.

Sarah Speirs, director RICS Scotland, said: “The market picture for Scotland in Q3 was relatively flat, and the referendum may have had an impact on commercial investment. We do expect to see activity pick up over the next quarter as the market regains traction.

“Across the UK the Q3 results provide further evidence that the economic expansion is becoming more broadly based with tenant demand for space picking up in all parts of the country and the need for landlords to provide inducements diminishing. There are also now clear signs that investors are casting their nets wider in a bid to find better value in the market following the steep drop in yields on prime property in London.”

Andrew Cartmail, BNP Paribas Real Estate, Edinburgh added: “There was a period of inactivity leading up to the referendum and we anticipate a return of investor and occupier confidence and activity.”