Commercial property transactions in the North West of England peaked at more than a billion-pounds in the second quarter of 2014 — an increase of almost 300 per cent on the same period last year.
Property consultancy Lambert Smith Hampton’s (LSH) UK Investment Transactions also reveals that the 12 months to the end of June recorded commercial investments of £2.16bn, a figure unmatched since 2007 and the beginning of the recession.
Of the £1.1bn worth of second quarter deals, British-based institutions snapped up the majority share — 76 per cent — of all the regional transactions.
The three-month period saw a trio of star deals: M&G Real Estate’s acquisition of One Spinningfields Square, Manchester, for £320m; LaSalle Investment Managers’ purchase of Warrington’s Golden Square Shopping Centre for £141m; and Schroder Property Investment Management’s acquisition of Manchester’s City Tower, from Bruntwood for £132m.
The Golden Square Shopping Centre sale also boosted the retail and leisure sector returns, accounting for 36.3 per cent of the total £398.5m investment activity.
Stressing that movement was gathering pace across all property fields, the LSH report highlights the “marked increase” within the office sector to the end of June. Investment in office buildings and space increased by 51 per cent, up from £95.35m during the first quarter of 2014 to £561.8m this year.
“The second quarter’s figures have been punctuated by very large deals, but overall the pick-up and shift in investment activity over the last few months means we have seen a fundamental change in the market,” explained LSH director and regional head of its capital markets division, Abid Jaffry.
“Deal volumes are up. Investors, especially UK institutions, are much more active in the regions which still offer better value compared to an over-heated London market,” he added. “The growing appetite for property funds from retail investors has also played an important role in the current market dynamic.”
Jaffrey explained that as the opportunity to acquire high-profile and high-return properties grows, and investment across the region rises, “the outlook for the rest of the year remains extremely positive with investment volumes looking set to continue at an impressive pace”
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