Irish spent €5.5bn and sold €1.89bn worth of UK property last year

MarketResearch:The Irish bought almost three times as much as they sold in UK property last year, writes Jack Fagan

A detailed study of transactions in the UK commercial property market shows that, while Irish investors spent almost €5.5 billion in 2006, they also sold properties valued at a further €1.89 billion.

The level of activity in the UK easily exceeded that in the Republic where €3.3 billion was spent on investment properties last year.

Figures compiled by Marie Hunt, director of research at CB Richard Ellis, show that the Irish were involved in 111 investment transactions and 47 sales.

The vast majority of investment acquisitions (45 per cent) completed by the Irish were in lot sizes valued between €10 million and €50 million while 30 per cent of the purchases related to properties where the lot sizes were less than €10 million.

There were 11 transactions ranging between €50 million and €100 million; 12 transactions between €100 million and €250 million; and four involving between €250 million and €500 million. The largest single deal involved the purchase of Woolgate Exchange Building in central London by D2 Private for €472 million.

Most of the Irish spend went into office investments. A total of €2.97 billion, or 54 per cent of the overall volume of business, was invested in 54 office properties, five of them business parks. A further €2.145 billion, or 39 per cent of the market, involved retail investments, seven of which were shopping centres. Only 3 per cent of the Irish acquisitions comprised industrial properties.

Interestingly, most of the investment activity was focused on central London where 43 per cent of the money was spent. However, Irish players were also active in many other parts of the UK, particularly in Birmingham, Scotland, Leeds and the M25 and Thames Valley markets.

One of the most interesting trends noted in 2006 was the high level of sales by Irish investors after several years of heavy buying. In fact, they disposed of 47 investment properties last year with a value of €1.9 billion. Most of the sales (52 per cent) related to lot sizes between €10 million and €50 million while 26 per cent of the transactions were valued below €10 million. Five of the properties sold made between €50 million and €100 million; four investments had a value between €100 million and €250 million; and one, an office building in Basinghall Street in central London, fetched over €300 million.

Almost three-quarters of all Irish disposals last year involved offices and 26 per cent of them were located in central London. However, there was also much selling activity in the M25 and Thames Valley market, as well as in Manchester, Birmingham, Leeds and Scotland.