May 5 (Bloomberg) -- The rate of decline in demand for U.K. office and retail space eased in the first quarter, the Royal Institution of Chartered Surveyors said, suggesting record-low interest rates are helping shore up the market.

The net balances for enquiries, demand and confidence were the least negative in a year with the industrial sector the most improved, the Coventry, England-based association of real-estate professionals said today in a report.

“The improvement in the market offers some hope that aggressive cuts in monetary policy have provided some limited support for the commercial markets,” RICS said.

A net balance of 40 percent of surveyors reported a drop in new sales and lettings to occupiers, compared with 71 percent in the fourth quarter.

The contraction of the U.K economy, coupled with rising available space, continued to reduce surveyors’ expectations of achievable rents, RICS said.

To contact the reporter on this story: Lars Paulsson in London at lpaulsson@bloomberg.net.

Last Updated: May 4, 2009 19:00 EDT