Belfast Telegraph

Investments stay resilient in quieter market

Market forecast: Martin McCloy
Market forecast: Martin McCloy
Margaret Canning

By Margaret Canning

Commercial property investment in Northern Ireland has been subdued so far this year, with £121m in investment deals around 50% below a year earlier, according to a survey today.

While the investment transactions report from agents Lambert Smith Hampton said investor appetite had improved in the third quarter, activity overall remained low at 38% below the five-year quarterly average.

LSH said there had been two major retail disposals, with Home Bargains buying Castlebawn Retail Park outside Newtownards for £7.2m, and a private investor buying Laharna Retail Park in Larne for £3.5m.

The last three months did see the first office investments of 2018 as three major assets changed hands.

Around £20m in investment deals are in the pipeline and set to complete in the last few months of the year.

With a combined value of £39.4m, the sales of Metro Building, Obel 68 and 20 Adelaide Street in the third quarter had accounted for 74% of deals.

The Metro Building at Donegall Square South was sold for £21.8m to an unnamed property trust, while Obel 68, which was sold to Belfast Harbour Commissioners, commanded £15.2m.

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Number 20 Adelaide Street was sold for £2.4m.

LSH said private Northern Ireland investors were very active, and were responsible for the largest proportion of investment volume in the year so far.

Martin McCloy, director of capital markets at Lambert Smith Hampton, said: "Although subdued in comparison to recent years, investment has remained resilient in the face of the political and economic headwinds of the last two years.

"We anticipate that quarter four will follow the same trend as the two previous quarters, with £20m of deals currently agreed or in legals.

"Investor appetite remains and investors are taking advantage where clear value can be found with quality assets quickly being agreed."

He added: "The uncertainty continues regarding the exact detail of the withdrawal and future relationship agreements between the UK and EU.

"A blueprint for the future trade and security partnership should further increase confidence amongst investors and the commercial property market."

Meanwhile, two major retail investments have come onto the market. In Londonderry, Crescent Link Retail Park has been put on the market by owners the Lotus Group for around £40m. Lotus Group also owns the Boulevard outside Banbridge, Co Down, and the Junction outside Antrim.

In Lisburn, Bow Street Mall is on the market with an asking price of £8.5m.

Belfast Telegraph