Manchester’s shops and sheds are hot property

MANCHESTER’S retail and industrial property markets been named as the only two investment hotspots in the UK by property consultancy DTZ.

The firm’s latest Fair Value Index report, which measures the relative attractiveness of property pricing for investors, upgraded both categories from ‘Warm’ to ‘Hot’ in its most recent survey, whereas the city’s office market was also upgraded to ‘Warm’.

Tony McGough, global head of forecasting at DTZ, said: “With bond yields compressing, and increasing stock market volatility, prime property in the UK is now relatively more attractive. It offers higher income yields and a broadly stable capital value outlook going forward.”

It said that rental growth and total returns in the retail sector will be modest in most markets, but with Manchester outperforming London and Glasgow.

Double-digit returns are also forecast for investors in the industrial property market, where large footprint space has dwindled.

Simon Lowe, associate director in DTZ’s Manchester investment team, said: “Throughout the continuing recovery, the vast majority of investment spend has been concentrated in London and the South East, causing more downward pressure on yields relative to the rest of the UK.

“It’s therefore no surprise that there’s value in the regional markets. Manchester in particular has a lot to shout about across all the sectors and this is vindicated by recent acquisitions by the likes of DTZ Investment Management, Henderson and SWIP.”