Business News Round Up (06/01/2025)
Scottish commercial property investment exceeds £2 billion
Investment volumes in Scotland’s commercial property market bounced back last year, as interest rates began to fall, and a decisive election result boosted the UK’s status as a safe haven. Total investment surpassed £2bn for the year, according to Knight Frank analysis of Real Capital Analytics data – significantly ahead of 2023’s £1.5bn and slightly ahead of the £1.9bn five-year average. Investment increased across all major commercial property asset types. Hotels had a particularly strong year, more than doubling on 2023 with a rise from £236m to £488m – a five-year high. Edinburgh accounted for more than half of hotel deals, at £247m. Meanwhile, offices also saw a significant increase from £368m to £509m, as interest in the sector picked up. Retail was the largest category by total investment with £710m – up 7% on £664m – and industrials rebounded from a five-year low of £292m in 2023 to £359m last year.
https://www.insider.co.uk/news/scottish-commercial-property-investment-exceeds-34424177
Firms to raise prices due to tax and wage increases
More than half of companies are planning to raise prices in the next three months as they face a “pressure cooker of rising costs and taxes”, according to The British Chambers of Commerce (BCC). The BCC said its survey of nearly 5,000 firms suggested confidence had “slumped”, falling to its lowest level for two years. Nearly two-thirds told the BCC they were worried about taxes following the Budget, which announced a rise in national insurance contributions (NICs) paid by firms from April. A Treasury spokesperson said the Budget delivered stability for business and more than half of employers would either see a cut or no change in their NI bills. Raising prices risks stoking inflation at a time when many people are struggling with the cost of living. While the rate of inflation has fallen sharply from record highs in 2022, it rose in both October and November.
https://www.bbc.co.uk/news/articles/c0j10420e2jo
KPMG predicts UK economic rebound fuelled by consumer expenditure and interest rate cuts
New forecasts from KPMG suggest that economic growth will pick up pace this year, driven by falling interest rates and increased government spending. The firm predicts a 1.7% rise in GDP over 2025, doubling the 0.8% growth expected for 2024, as reported by City AM. “Buoyed by a looser monetary and fiscal policy stance, growth in the UK economy may stage a welcome recovery after a lacklustre performance in the second half of 2024,” it stated. KPMG anticipates that consumer spending, fuelled by rising real wages and less attractive saving options due to lower interest rates, will drive this acceleration. Consumer spending is projected to grow by 1.8% this year, an increase from 1.0% the previous year. However, inflation is also expected to persist slightly more than previously anticipated due to stronger demand.
https://www.business-live.co.uk/economic-development/kpmg-predicts-uk-economic-rebound-30715616