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Glasgow beats Edinburgh for property deals

INVESTMENT from Asia helped the value of commercial property deals in Glasgow exceed Edinburgh for the first time since 2015.

However, the overall value of deals continued to fall in the second quarter, according to the Scottish Property Federation (SPF).

Deals worth a total of £172 million were concluded in Glasgow in the second quarter, up from £104m for the same period last year, compared with £108m in Edinburgh, down £14m.

It was the first time the value of deals in the west exceeded the capital total since the first quarter of 2015, with the market in Glasgow boosted by the £48.4m purchase of 110 St Vincent Street by South Korean investors. The building is occupied by Bank of Scotland.

While deal values rose in Glasgow, the overall value of sales in Scotland slipped to its lowest in five years, at £641m.

SPF director David Melhuish said: “Glasgow was very impressive this quarter, outperforming Edinburgh for the first time in four years against a wider Scottish market that saw a reduced value of sales activity.

“Glasgow’s sales increase was fuelled by a number of £5m-plus deals, totalling £129m, whereas Edinburgh only secured £33m in the same category.

“A notable feature of Scottish commercial property investment in the Q2 period was the rise of capital sourced from Asia, which topped £250m for the first time on record, according to CoStar data.”

By Scott Wright

Source: Herald Scotland

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Commercial property deals soar as ‘strength in depth’ is celebrated

The East Midlands’ real estate transactions rocketed by 24% to £700m, compared with the same period in 2017, according to the latest research from JLL’s capital markets team.

JLL’s analysis shows that across the UK, transaction levels were the strongest seen in any Q1-Q3 period since 2014. The largest overseas buyer group came from the Asia-Pacific region, accounting for 17% of all deals, with European investors taking 14%.

Ben Kelly of JLL’s Midlands Capital Markets team says that whilst European appetite for real estate assets has been subdued by political uncertainty, would be investors from further afield appear less affected by such concerns, and are simply looking for long term value.

“When we talk to overseas buyers, they are keen to take advantage of opportunities here, because of the yields they can achieve against those they see in other markets, and also movements in the currency markets which favour them,” he says.

“Having said that, relative pricing in the East Midlands still makes it a very attractive market for domestic capital and this is creating a competitive marketplace.”

Further encouragement for the East Midlands came just after Q3 ended, as CEG acquired Nottingham’s City Gate scheme, whose 175,000 sq ft of space makes it one of the city centre’s largest office schemes. CEG acquired City Gate in a joint venture with a Swedish Pension Fund, demonstrating the international profile of the current purchaser audience.

Having worked on the sale alongside JLL capital markets team, James Keeton, director within the agency team of JLL’s Nottingham office believes the strength of the region’s real estate economy lies in its depth.

“As the City Gate deal showed, it’s not only the industrial and logistics sectors that are seeing strong activity in the East Midlands; well-let prime office schemes continue to attract investors, particularly those where buyers are confident, they can add value, often through strong asset management and refurbishments.

“Equally, it’s the buoyancy of our industrial, distribution and logistics markets which underpins deal activity year on year. Our strategic location as a region continues to deliver robust demand, especially for prime M1 locations and with continued letting activity and speculative development across the region, investor demand is anticipated to deliver a very strong 2018 in terms of transactional activity.”

Source: The Business Desk