North sees falling interest by foreign buyers in commercial property
Survey finds occupier demand continued to rise across all sectors but space had reduced
“It is encouraging to see some new office refurbishments starting, but the lack of availability of space, particularly grade A office accommodation, remains a key challenge for the market”
Northern Ireland was the only part of the UK to report falling interest from foreign investors in commercial property acquisitions. Demand from overseas buyers increased elsewhere in the UK, particularly in central London where investment inquiries rose at their sharpest rate since 2015.
According to the Royal Institution of Chartered Surveyors (RICS) Q1 2017 commercial property market survey, it marks the fourth straight quarter of declining demand in the North.
The RICS said the latest survey also recorded the highest proportion of industry professionals who had received inquiries from businesses looking to relocate from Northern Ireland because of “uncertainty about the future relationship with the EU”.
The RICS said around 42 per cent of respondents indicated that businesses were taking about relocating compared to a headline rate of just 16 per cent for the UK in general.
Locally the RICS and Ulster Bank NI commercial market survey for quarter one shows occupier demand continued to rise across all sectors but availability of space had reduced – the RICS expects this will push up rents over the next three months.
RICS Northern Ireland commercial property spokesperson, Tracy Flannigan, a director at Colliers International, added: “In terms of occupier demand and rent expectations, the Northern Ireland commercial property market started 2017 much as it ended 2016, with good demand evident.
“It is also encouraging to see some new office refurbishments starting, but the lack of availability of space, particularly grade A office accommodation, remains a key challenge for the market, as well as some uncertainty on the horizon in relation to Brexit, which can be seen in the figures relating to foreign investment inquiries.
“However, for now, rental and capital value expectations remain positive.”