The construction industry in the UK has fallen back into recession for the first time in four years, fuelling fears that the British economy is on course for a sharp slowdown in the wake of the Brexit vote.
And UK commercial property values fell 3% in July, according to preliminary figures for the closely-watched IPD real estate index.
The index is compiled by MSCI, which said Central London values fell by 3.8% on the month.
Expectations of a sharper fall in property values led retail investors to flee UK property funds last month after Britain voted to leave the European Union, causing as much as £18 billion in property fund investments to be frozen.
The Office for National Statistics said construction output dropped by 0.7% in the second quarter, following a 0.3% fall in the first quarter, two consecutive quarters of negative growth for the first time since 2012.
It added that construction output dropped by 0.9% in June, compared to a 2.1% fall in May.
The slide in output comes as a measure showed that the construction industry recorded its fastest fall since June 2009 last month, with a reading of 45.9 in July, down slightly from 46 in June.
"The downturn looks set to deepen in the third quarter. July's construction Purchasing Managers' Index broadly is consistent with output falling by about 3.5% quarter-on-quarter," Samuel Tombs, chief UK economist of Pantheon Macroeconomics said.
However, the ONS said there was very little anecdotal evidence at present to suggest that the referendum has had an impact on output.
Construction's second quarter fall was revised to 0.7% from the initial estimate of 0.4% made by the ONS at the end of July, but this change did not impact upon its estimate for gross domestic product for the period.
GDP grew by 0.6% for the second quarter, up from 0.4% in the first quarter of 2016, thanks to the strongest performance from industrial production since 1999, according to official figures.
Mr Tombs said protracted Brexit negotiations will hamper the construction industry going forward, causing businesses to hold off from committing capital expenditure.
