Commercial property sector 'to bounce back' as raft of new Belfast hotels come on stream
Hotel development in Belfast will be a major driver of growth in the commercial property market in Northern Ireland this year, it has been claimed.
In its outlook for the year, commercial property agency CBRE said it was confident the general commercial property market would expand this year despite uncertainty following the vote to leave the EU.
And it said that the large number of new hotels planned for the city would boost the market - which continued to provide better value for money than other UK cities.
CBRE also believes Northern Ireland may be able to cope better with any downsides of Brexit than other UK regions.
Miles Gibson, head of research at CBRE UK and a former senior civil servant who worked at HM Treasury and the Cabinet Office, said: "Whilst we are unlikely to see the full picture emerging from the EU referendum result in 2017, Northern Ireland will have some advantageous benefits over its UK counterparts.
"Weaker sterling, a unique tax regime, a lower dependence on migrant labour than other parts of the UK, and the likelihood of special border arrangements with the Republic of Ireland will all help the Northern Ireland real estate market through this uncertain period."
There are around 20 new hotels on the way in Belfast, with work started on a number of them, including Hastings Hotels' Grand Central and Dalata Group joint development with McAleer & Rushe's on the Maldron Hotel - both in the Bedford Street area.
And a Marriott Hotel will open on Clarendon Road in Belfast Harbour's City Quays.
In the nearby Titanic Quarter the former Harland and Wolff headquarters building and Drawing Offices are to be converted into a boutique hotel.
Brian Lavery, managing director of CBRE in Northern Ireland, said: "Belfast has a strong demand for hotel rooms and an ever-growing tourism industry, and it is encouraging to see developers addressing the requirement in the city.
"The hotel sector has strengthened over the last number of years and is set to make significant strides in 2017, with over 1,000 beds being built."
CBRE's 2017 outlook said an upswing in retail had helped the commercial property market and would continue to do so this year as the weaker sterling brought cross-border shoppers in large numbers.
CBRE predicts that 2017 would see an upswing of investment deals this year, after the fallout from the EU referendum hit deal volumes last year.
The agency also expects the office lettings market to improve, with much of the increase from refurbishments due to a growing demand from companies for grade A office space.
Andrew Marston, research director at CBRE UK, said: "Despite plenty of uncertainties in the wider political and economic spheres, the fundamentals for commercial real estate in Northern Ireland remain sound.
"For most sectors, demand remains robust, but the choice of available space to meet occupiers' needs, be it office space or city centre retail units, remains very limited.
"However, this is not a position unique to Belfast: numerous other UK city markets are facing similar challenges at this time.
"And from an investors' point of view, value is still to be had in Northern Ireland, with a clear pricing differential between comparable markets in both the UK and Ireland."