Savills' index falls to lowest level since data was first collected in March 2003

Commercial development activity has fallen to a five-year low, according to a new survey by Savills.

The survey鈥檚 index of commercial development activity fell to its lowest level since Savills started collecting data in March 2003.

Almost a third of commercial developers reported a fall in overall activity in April, compared with just 12% who registered a rise.

The survey found that respondents were 鈥渉ighly pessimistic鈥� about the three-month outlook for the office development, industrial/warehouse and retail and re sectors. Many said the completion of existing projects would lead to a further fall in activity over the summer.

Mat Oakley, head of commercial research at Savills, said: 鈥淭he steady stream of bad news relating to the effects of the credit squeeze on the wider economy is clearly impacting on developers鈥� confidence. Until the debt market eases, and uncertainty about tenant demand relaxes, we expect developers to remain cautious.鈥�