Good news continues in 2018 for the UK property investment sector. Over the course of the first quarter, nearly £13.5 billion changed hands. Of this, £12 billion was spent directly in property investment. This trend also follows the fact that commercial property investment across the globe, on the whole, is at a 10-year high in quarter one of 2018.
This rise has also seen a growth in the popularity of alternative investments; in particular, hotels and student accommodation. As such, the opportunity for investment in the UK continues to grow and develop. For this reason, this growing interest is something we here at Roger Hannah & Co have been watching carefully in order to better understand and offer advice as part of our specialism of commercial property investment.
During the First Quarter period the rental sector – both commercial and private – saw prime rental yields, largely driven by the outperformance of the Industrial sector. Increases by 2.3% over the quarter, though High Street shops rental decreased by around -0.03% in the quarter – which is minimal enough to not be a concern. Office rent also increased by around 0.4% overall in the First Quarter of 2018.
Overall, this improvement to rental values seems to have inspired more investment in the commercial property sector for the quarter. As we move closer to Brexit, we might expect this to be less the case and yet the sector seems to be holding strong in spite of looming political uncertainty.
Rise in Pharmaceutical Investment
One of the biggest signs of a continued strong investment showing for the commercial sector is the fact that pharma companies are continuing to seek new offices in Britain. This is quelling the fears of many that companies are looking to pull out of the UK prior to Brexit. A Swiss company Novartis, flu specialists Seqiris and Australia’s CSL are all understood to be looking for new UK bases around the UK.
Though the pharma industry is currently working under the assumption that Brexit could spell the withdrawal of vital research funding from key projects, as well as making recruitment for UK-based jobs that much harder. Despite these concerns, it is encouraging to see the continued investment in commercial property from this sector.
To find out more about how the Roger Hannah & Co team can help with all of your commercial property investment needs, contact us by calling 0161 817 3399 or filling out the form.