Manchester becomes investment hotspot

MANCHESTER is the city which offers the best vale for investors looking for returns in property, according to a new survey by DTZ.

The firm said that the overall UK property market offered less value to investors than it had, with the rising value of government bonds raising the risk-adjusted returns required from investment.

However, it classified Manchester’s industrial and retail markets as ‘Hot’, arguing that both solid income return and strong retail growth are expected to underpin capital values. Even the city’s recovering office market is described as “warm”.

Bruce Poizer, investment director for DTZ in Manchester, said: “Manchester is the stand- out UK region for commercial property investment opportunities, according to this latest research.

“The report indicates market prospects for most of the UK have broadly weakened across all sectors, principally due to a rise in five-year government bond yields, which we use to benchmark property returns.”

He said that the city’s retail and industrial markets are the only two markets in the UK to be currently rated as ‘Hot’ by the firm, and are estimated to be undervalued by 8% and 6% respectively.

“With forecast returns supported by attractive yields and solid rental growth prospects, Manchester offers a very attractive alternative market to London where much recent investment activity has been concentrated.”