Investment in UK property in January 2018, compared to the same month last year, has seen an increase of over 50%. Offices and industrial locations are the primary focus of this investment, largely as a result of the booming start-up communities taking root in large cities across the UK and areas outside of London, in particular those that have seen a great increase, such as in Manchester.
Growing Stability
There has been a slightly volatile nature to the commercial property market in recent years, primarily following the upheaval of the Brexit decision, which seems to be stabilising in 2018. Investor confidence appears to be returning to the sector. There is still uncertainty over Brexit, but it is not preventing or slowing down investment.
Overall, property investment continues to rise year on year, with nearly a quarter more investment capital in 2017 (£65.4 billion) compared to 2016. Showing promising signs that investors are continuing to see beyond Brexit to a secure financial future and stability for the UK commercial property market. This rise also comes as a result of the weakened pound, which has actually brought more tourism, which in turn has been a contributing factor to increased overseas investment. The weakened state of sterling is becoming a ‘prime’ investment period.
Though it is important to note, the sector is expected to weaken slightly before 2019 as Brexit looms closer. Investors are expected to take a wait-and-see approach.
Positivity
Continued investor interest in the UK commercial sector is, on a whole, very positive for the property sector. Especially as over half of the investments come from overseas, with particularly heavy investment coming from Asia. It proves that, despite the political climate, there is still confidence in the UK market as a whole.
Development opportunities, both in London and wider areas, continue to be relevant to investor’s needs. Which means that new sectors will continue to be brought to these areas and drive further financial activity throughout 2018. As a whole, the commercial property sector is a secure source of income for investors, and this does not appear to be changing.
This growing investment also comes as a result of a positive upward trend for start-ups, as they are expanding past initial creation and causing further property growth. This is particularly evident in the booming tech start-up community. Which has led to investors acquiring affordable office space in order to lease to the growing number of start-ups, securing guaranteed income from this sector for the foreseeable future as a result.
If you would like to discuss your own commercial property needs, then don’t hesitate to get in touch with our talented team of property agents here at Roger Hannah & Co.