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Belfast office lettings hit five-year high, says CBRE

By Margaret Canning

The Belfast office market expanded by 40% during 2016 - its best performance since at least 2011, according to research.

CBRE said the growth in take-up came despite potentially unsettling factors such as the EU referendum and the US presidential election.

Last week, CBRE said the EU referendum led to a slump in investment purchase transactions from £400m in 2015 to £248m last year - but the economic and political turmoil had no impact on office lettings in Belfast.

The performance for 2016 was up 25% on the five-year average, CBRE said. In total, 435,000 sq ft in office space was let in 63 transactions, spread evenly between the first and second half of the year. That compared with the five-year average of 353,000 sq ft.

CBRE director David Wright said: "This is the best year for the Belfast office market since we began recording the figures in 2011.

"The previous year closest to matching these figures was 2013, when one particularly large one-off transaction skewed the figures.

"The 2016 figures were not influenced by any major public sector deals so it indicates the strength of the market from the private sector and the ongoing demand from companies seeking to secure office space in Belfast."

But he said he was concerned about the impact of proposals from the Department of Finance.

"The current rates consultation paper issued by the department is proposing further increases in vacant rates liability which could impact developers' decision-making process on speculative development due to the potential increased liabilities."

And the measures could pose a barrier for developers who could otherwise address the shortage of Grade A offices: "We need to encourage new development to help Belfast compete with other European cities to attract FDI as well as assist our local companies expand and attract new talent."

Mr Wright said developers should be given incentives to build new offices.

He added: "In order to encourage new office development we would call on government to consider offering a longer rates free period to developers."

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