2015 Proves A Busy Year For Commercial Property In Northern Ireland
Belfast, November 2nd 2015 – A hectic end to 2015 is the prediction from the final Bi-monthly Report by CBRE, with 300,000 sq ft of office leasing activity likely to be recorded in Belfast once final quarter transactions are signed.
Click here to download the full report: CBRE Northern Ireland | Bi-Monthly Research Report November 2015
Scroll down to view Head of Research, Marie Hunt's November Bi-Monthly Video Commentary for the Northern Ireland CRE market
The office market has been buoyed by the fact that City Quays 2 is now under construction and a number of new schemes are in the planning process, which will eventually see much needed Grade A office space being provided. Rents are now up to £16 per sq ft and are expected to rise in 2016.
Investment spend has also been at a notably high level in 2015, with up to £500 million worth of transactions due to complete by year end, with almost half of this occurring in the last two months of the year.
Recent significant investments include Fairhill Shopping Centre in Ballymena, which sold for £45.8 million reflecting a yield of 8.43% as well as Bloomfield Shopping Centre in Bangor, recently gone sale agreed for close to the £54 million asking price. Other properties currently being marketed include Damolly Retail Park, Newry guiding £33.5 million, Tesco Extra, Craigavon asking £25 million and Lisnagelvin Shopping Centre, Londonderry asking £17 million.
Retail has had a number of boosts this year with national retailers including Yours Clothing, Bon Marche and Schuh Kids opening in CastleCourt Shopping Centre. Dunnes Stores are due to revamp and extend its flagship store at the Abbey Centre where Next will be carrying out a similar project.
Retail Vacancy rates have diminished with Donegall Place fully let and the former Barratt’s store reportedly let to Inditex brand, Stradivarious. Boux Avenue recently opened in Victoria Square and CEX and Uberfone have leased accommodation at Rushmere Shopping Centre, Craigavon.
Industrial rents have increased for the first time in several years in Northern Ireland due to a shortage of prime accommodation. Prime headline rents are now in the order of £3.50 per square foot.
The hospitality sector has a number of promising schemes in the pipeling with Ten Square Hotel in Belfast applying to build a 71 bed extension, permission granted to convert Windsor House into a 200 bed 4-star hotel and Nightclub El Divino currently for sale at £1.75 million.
Brian Lavery, Managing Director, CBRE Belfast commented:
“Now entering the final two months of the year we are set to see considerable activity in the NI commercial property market. As we have seen over the last number of years, there is a tendency for a large amount of transactional activity to conclude in the last few weeks of the year.
“The increasing surge in the office market and rising rents have coincided with upward pressure on rents in the industrial and retail sectors. We recently hosted a conference at our London HQ where we were able to highlight the investment opportunities in the NI market due to the notable pricing differential between Belfast and competing UK cities.
“Despite any political uncertainty and on-going negotiations, Northern Ireland is set for a busy two months ahead as the usual clamour to get deals signed by year-end kicks off. CBRE have moved into our new office at Linenhall Street and we look forward to welcoming our clients to our new premises in the coming weeks and months.”