Belfast Telegraph

Retail property market takes off after Nama's £1.1bn disposal of loans

By Lesley Houston

Signs that the eagle has finally landed in Belfast's retail property market have been signalled in a report which points to new high-profile lettings in the city centre.

The CBRE's bi-monthly research report said the recent estimated £1.1bn sale by Nama of loans owed by debtors in Northern Ireland to a US investment firm Cerberus – the culmination of Nama's Project Eagle – unleashed 'pent-up' demand following a stagnant period in the property market.

The paper points to shoots of growth in the retail market with Spanish fashion house Mango preparing to open in Victoria Square.

Other new lettings in the high-end retailer sector include Karen Millen, which relocated from Donegall Place to Victoria Square, and Fatface as well as Joules, Bravissimo and Pepperberry.

It also highlights 'significant' investment properties to sell recently, including the Obel development in Belfast, sold for an estimated £22m.

The report also revealed "strong interest" in the Gasworks complex, said to be under offer at approximately £4.3m to a Northern Ireland investor.

Outside Belfast, notable sales included the Mall Shopping Centre in Armagh, which was recently sold to Development Securities plc for £7.4m.

Brian Lavery, managing director of CBRE in Belfast, said: "Certainly the sentiment is that things are ever improving and I would say that is expected to improve and to trend stronger in the next few quarters."

The report showed a 6.5% increase in prime yields in the retail sector in Belfast compared to the previous quarter, in what it described as a "stronger" trend.

Demand for prime investment opportunities continues to primarily emanate from UK institutions and USA equity funds, the report noted.

In contrast to the Republic, where demand for retail property has increased significantly over recent months, investors in Northern Ireland seeking retail opportunities over the last number of years are now also focusing on office investment opportunities.

The report said even availability of funding had improved, with favourable terms available on good quality property assets.

The CBRE paper said office take-up in the region had been "somewhat disappointing" in the first quarter but that there were several office lettings currently in the planning stages.

Employment boosts by companies including Convergys, Concentrix and EY were expected to further spur on movement in office property in the coming months.

Belfast Telegraph