Q2 figures down on an exceptional Q1

However, the latest edition of Lambert Smith Hampton’s UK Investment Transactions report also reveals a marked difference between the two quarters: £185.5 million of investment transactions was reported between April and June, which is a 60% drop on an extremely strong first quarter.

National context

National trends show a 10% increase in commercial property investment from Q1 and a 45% increase compared to the same period last year, demonstrating considerable momentum in the market. Investment within the office and industrial sectors in Yorkshire rose compared to Q2 2013. Office investment has increased by 23.8% and industrial the greatest increase at 31%.

Significant transactions in Yorkshire

Significant transactions within Q2 included Tritax’s acquisition of the 106,552 sq ft Next warehouse in Doncaster for £60 million reflecting a net initial yield of 6.07% and the sale of King’s Pool in York to Standard Life for £43.5 million reflecting a net initial yield of 5.90%.

Regional activity increases

UK buyers represented 85.7% of total investment for Q2 compared to 52.7% in Q1 2014, resulting in more regional activity. Investment across all regions hit £9.5bn during the first six months of the year compared to £5.9bn in the first half of 2013.

Comment

Abid Jaffry, Director and Regional Head of Capital Markets at LSH commented:
“We’ve seen a fundamental change in the market. Deal volumes are up more than 50% from this time last year and investors are much more active in the regions . Although we have seen a drop in the total value of deals for Yorkshire this quarter, compared to an exceptional Q1, we expect overall volumes for 2014 to surpass those of 2013.”