The majority of Scotland’s third quarter commercial deals were squeezed into the two weeks following the independence “No” vote, one of the country’s biggest property organisations has claimed.
More than £962m worth of Scottish commercial, retail and industrial real estate was traded between July and September, almost double this year’s second quarter total of £592m.
Glasgow saw the biggest post referendum surge, from an unusually low April to June transaction figure of £58m jumping to £242m during the following three months, again the majority squeezed into the post vote period.
The Scottish Property Federation (SPF) — which analysed the figures from the Registers of Scotland — says the “resurgence and the spike in activity between June and September suggests that market activity was considerably more in the last two weeks of September following the vote”.
Federation director, David Melhuish, added: “This latest analysis of commercial property sales in Scotland suggests a very strong bounce-back from any pre-Referendum uncertainties or delays, with the value of commercial property sales in Scotland jumping considerably.”
The SPF pointed out that investors could also be rushing to complete high value deals before the Stamp Duty Land Tax (SDLT) is replaced by Land and Buildings Transaction Tax (LBTT) at the start of April, 2015.
It has already warned that if the new tax is seen to be too penal by investors, it could cause the Scottish property market to be perceived negatively by investors.
Nor does the SPF agree with Scottish Government calculations that 95 per cent of commercial transactions will pay the same or less under LBTT than SDLT. Its figures show that of £962m in recent deals, around £772m were transacted in £2m-plus — suggesting that at least 75 per cent would be facing higher tax liabilities under LBTT than under SDLT.
Stressing that confidence was returning to the Scottish commercial property market, particularly for high value major investments, Melhuish added that “it was important the introduction of LBTT does not de-rail this recovery in commercial property investment activity and that Scotland’s commercial assets are viewed negatively by investors”.
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