Q2 property investment totals £610m in NW

The Lowry Hotel

Property investment in the North West totalled £610m in the second quarter of 2017 – a rise of 39% on the first period of the year, but only 5% ahead of Q2 in 2016.

The latest edition of the UKIT (UK Investment Transactions) Bulletin published by Lambert Smith Hampton reveals activity is 9% up in comparison with the five-year quarterly average and more than half (£428m) of the Q2 activity in the region occurred in Greater Manchester.

One of the most noticeable shifts in activity was in the hotel and leisure market, which saw £147m transacting.

This was a quarter of the region’s total investment during Q2, and equates to a 12% increase on the previous quarter.

Key to the investment volume were the sales of the Holiday Inn, Aytoun Street, Manchester and the Lowry, Salford, which sold for £54m and £53m respectively.

The only sector which saw a drop in investment volumes was retail and leisure where only £75m transacted however this is largely as a result of a lack of stock in this sector.

The industrial market showed a 80% increase with £167m transacting in Q2. Notable deals were the sale of Stakehill Industrial Estate to UBS for £47m and the acquisition of the BAE unit in Crewe by a Korean Consortium for £56m.

Office investment increased by 19% in Q2, with 50% of the deals being in Manchester city centre.

Ben Roberts, director, LSH Capital Markets, North West said: “While the resilience of the North West market is welcome news for investors, buyers are having to work much harder to dig out deals and we have seen a significant increase in ‘off market’ and ‘selective marketing’ campaigns over the last quarter.

“Despite a continued lack of stock, the North West, and Manchester in particular, remains an attractive proposition for the investment community. We are seeing investors turn to the alternative sectors, and hotels in particular, where they have comfort in the sector’s future performance and are able to find better returns.”

Out of the 56 investment deals which occurred during Q2 2017, the average lot size was £11m, illustrating the number of high value deals completing over the course of the quarter.

Click here to sign up to receive our new South West business news...
Close