Demand for property in the East of England's retail sector is continuing to fall, new research shows.

The latest RICS commercial property market survey found the downturn in retail in the second quarter of 2018 contrasted with the region's industrial sector, which is attracting interest from occupiers and investors.

Around 37% of survey respondents in the retail sector in the East had noted a fall in demand over the quarter, while industrial enquiries continued the growth seen in the previous three quarters.

The survey also found a fall in demand for office space.

RICS said empty retail units were becoming 'increasingly visible' in the region's towns, but that availability of industrial space had declined again over the quarter.

The report said: 'Pressure is most intense on secondary retail, while the prime retail rent indicator is also in negative territory – though to a lesser extent than secondary.'

It said the capital values of secondary retail sites were likely to be most vulnerable over the coming year, with prime industrial space predicted to show the strongest gains.

Those polled by RICS were also asked about Company Voluntary Arrangements (CVAs), which have been used by retailers including House of Fraser and New Look this year to close stores and write off some debt.

Around a third reported seeing an increase in the use of CVAs in the past year, with around two-thirds anticipating that this will lead to more retailers putting CVA clauses into contracts going forward.

'As such, it is unsurprising that over 70% of contributors' sense investors will be looking to scale back exposure to the sector,' RICS said.

Simon Rubinsohn, RICS chief economist, said: 'The challenges being faced by retail not surprisingly come through strongly in the latest set of results, but the counterpoint to this is the ongoing strength of demand for good quality, well located industrial/logistic sites.

Sam Kingston from property services firm Roche in Norwich said: 'A continued decrease in stock levels has led to pressure on industrial rents across the region. The office market remains patchy, but there are signs of increased tenant demand, which will hopefully lead to rental growth. With 11 months to go before Brexit, there is the chance some businesses will put property moves on hold, while the uncertainty remains.'