Knight Frank LLP, the leading independent global residential and commercial property consultancy, has announced its final results for the year ended March 31, 2010.
Nick Thomlinson, Senior Partner and Chairman of the Knight Frank Group, said, "I am delighted to report a strong performance across the group with all regions delivering profits. In the UK, our residential business once again out-performed the market and our commercial operations capitalized on improved transactional activity whilst also building its consultancy base. All of our continental European businesses returned to profitability and we continue to extend our Asia Pacific operations with particular emphasis on Australia, India and Greater China.
"We remain debt free, and have our cost base at a controllable level which has helped to further strengthen our balance sheet.
"In the past 12 months the emphasis has been on our exceptional staff and teams continuing to deliver the best service and trusted advice to our clients. We go where our clients most need us and this year we have expanded our global office network by opening in Vietnam, South Korea and Abu Dhabi. Our growth strategy remains focused on organic expansion in key markets with the best people.
"We continue to have a good balance between transactional and professional services activities. Our professional services teams have been in more demand than ever as our clients have required trusted advice on their existing assets to ensure their potential is maximized and that they are valued to the highest standards. We remain a well-diversified business across both residential and commercial and this remains our approach.
"The improved performance of the group has continued in the first half of the current financial year. Nonetheless, we remain cautious about the outlook for the full year given prevailing economic uncertainties around the world. With this in mind we have again retained profits in the business to strengthen further our balance sheet, ensuring that we are among the best positioned in our sector to meet and take advantage of the challenges ahead. We have the best teams and our business is in great shape."
UK commercial property market outlook
"The UK has experienced healthy economic growth in the first half of this year, while other indicators such as retail sales and inflation have proved to be of less concern than had been expected. The decline in rents across all sectors has reduced notably, and has almost turned positive, and take-up levels have improved in the London and South East markets.
"Prices continue to grow, although at a much slower rate as investor uncertainty surrounding the wider economic backdrop is set against the more secure assets now being keenly priced. With healthy double digit returns already achieved in the first part of the year, 2010 is likely to prove to have been a very good year for property returns.
"Going forward, with public sector debt the equivalent for more than half of the UK GDP, the issue remains to what extent the recovering private sector will be able to compensate for the anticipated cuts to the public sector. Consequently 2011 is expected to be a more difficult year, both in economic and property performance terms. Nonetheless, we expect moderately positive returns and reasonable levels of activity, improving particularly in the latter half of next year, before rebounding once again in 2012."
International commercial property market outlook
"The Asia-Pacific region has led the global economic recovery, with China and India recording GDP growth similar to the very high levels seen before the financial crisis. This has supported a revival in the region's occupational property markets, with Hong Kong seeing some of the strongest rental increases anywhere in the world over the last 12 months, while more modest rises have been observed in cities including Singapore, Shanghai and Sydney. Rental growth should continue to spread across Asia-Pacific during the next year.
"Investment levels in the region