Market in office lettings buoyant, say agents CBRE
Activity in the commercial property market in Northern Ireland is expected to continue at a lively pace through the autumn, agents CBRE said today.
The firm said it expected a busy period of transactions over the next few months, with high profile properties coming onto the market, and banks continuing to clear their property loan books as part of the deleveraging process.
The market in office lettings has also been buoyed by a large number of inward investor announcements in recent months – including the creation of 250 jobs in legal services by US firm Baker & McKenzie, announced last week.
Brian Lavery, managing director of CBRE in Belfast, said: "Although activity in the occupier markets was relatively subdued during the first half of the year, there has been a discernible improvement in activity over the summer months and with economic prospects showing signs of improvement, we expect to see strong volumes of leasing and sales activity being recorded in all sectors over the coming months."
Mr Lavery said the good summer for the property sector had also been abetted by the lack of disturbance during the marching season, and a pick-up in tourism.
But he said the outcome of the referendum on Scottish independence was also being closely watched, as it is expected to have ramifications for the long-running campaign for Northern Ireland to be granted the power to set its own rate of corporation tax.
He said there was still strong interest from investors in the market, with "strong interest" in the Windsor House office block on Bedford Street, which has a guide price of £5m.
And the building housing the Premier Inn hotel in the Titanic Quarter recently sold for £6m –though CBRE said it could not reveal the identity of the purchaser. CBRE has also been appointed agents by Ulster Bank in the sale of its Project Nadal portfolio of loans on leisure sector assets on either side of the border.
And there had also been some big transactions in retail investments, including the sale of Foyleside Shopping Centre in Londonderry and Forestside Shopping Centre in Belfast for £145m to Kildare Partners, and the sale of the Abbey Centre in Newtownabbey to NewRiver Retail for over £64m.
Those deals had been part of Project Swallowtail, as shopping centres in Northern Ireland, the Republic and England belonging to businessmen John B McGuckian and Ken Cheevers were packaged up and sold by lender Ulster Bank.
The agents also said activity was growing on the retail lettings side in Belfast city centre. While there had been no rental growth, there was heightening interest in sought-after sites. The last empty store on Arthur Street, which has evolved in a niche location for mid-market to expensive shops, had even sparked a bidding war, with ladieswear brand Jaeger winning out as it moves from its long-term Donegall Square West location.
In fact, there was even a queue of retailers wanting to occupy Arthur Street spots, CBRE said.
Readying itself for the Christmas rush, toy shop Toys'R'Us had signed up to its first small format store in CastleCourt Shopping Centre.
Meanwhile, there was strong demand for good quality industrial accommodation, according to CBRE.
However, supply was limited, CBRE said, as reflected in the recent sale price of £3.3m for the old C&C factory on Castlereagh Road in east Belfast.