Wednesday, October 29, 2014

News: Yorkshire still on for record year

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Continued high levels of commercial property deals in Yorkshire mean that 2014 is set to be a record year for investment in the region.

Commercial property consultancy Lambert Smith Hampton (LSH) tracks the region's deals in its UK Investment Transactions report. The latest edition reveals that the 2014 year to date investment in Yorkshire at £1.01bn is already higher than full year figures since 2010.

Investment in the Yorkshire commercial property sector during the third quarter of 2014 reached £354.83m - a 91% increase on the previous quarter and 18% higher than in the corresponding period last year.

The report showed that investment in UK regions totalled £6.0bn in the past quarter, the highest level since 2006, and the first time that investment in the regional markets has outstripped inflows into London since the start of 2011.

The largest deal in Rotherham during the period saw Standard Life Investments Property Income Trust Limited (SLIPIT) acquire a Templeborough distribution warehouse, currently home to the Symphony Group, in a £14.6m deal. Rotherham college's Howard Building in the town centre was also sold prior to going to auction from a guide price of £250,000.

Abid Jaffry, director and regional head of capital markets at LSH, said: "We continue to see high levels of competition among investors for UK commercial property, and Yorkshire is set to enjoy an exceptional year in terms of returns and investment volumes boosted by the main sectors.

"Capital continues to flow back into the regions in a meaningful way as improving confidence and the price of assets in London prompts investors to look beyond the capital.

"In addition, the returns being offered in some of the secondary markets remain attractive to investors wishing to take advantage of the higher yields and positive occupier sentiment.

"However, yields are hardening and lower than average in many sectors which means the pace of capital value increases is likely to slow in the next 12 months. There is still scope for further growth but these will be mainly driven by rental growth rather than further inward yield shift."

LSH website

Images: Knight Frank

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