Boston, MA -- (SBWIRE) -- 05/01/2014 -- The UK's real estate sector has performed well since the property crash and recession took hold, despite experiencing two years of negative economic growth, in 2008 and 2009. Growth has been sluggish in the years since, but a healthy project pipeline and low vacancy rates, particularly in the office and retail segments, has bolstered investment and returns. However, a lack of short-term development in certain areas, such as office space in London, could lead to demand outstripping supply.
Office and retail space have been leading the charge in terms of real estate performance in the UK. London, as usual, posts the highest rental rates, with Old Bond Street continuing to be the most expensive shopping street in Europe. However, a slew of projects, particularly, in the retail segment, have been getting under way in other areas of the country, such as Birmingham, Sheffield and Liverpool, diverting investment away from trophy assets in London and the South East. This is positive news in terms of job creation and funding dispersal. According to CBRE, office leasing activities in UK regional cities outside of London are at their highest for five years.
View Full Report Details and Table of Contents
Snowballing economic growth (with 2.6% forecast for 2014 from 1.7% in 2013) is driving rental rates higher. However, there are fears that demand many begin to outstrip supply in certain areas, such as office space in London, with no short-term developments in the pipeline. The only UK city to have more than 200,000sq ft of speculative space under construction is Manchester. Darren Yates, a partner at Knight Frank says: 'Vacancy rates are trending downwards due to a lack of development, and there is a real shortage of space in some cities.'
- UK real estate investment trust LondonMetric Property has acquired Oak Furniture Land's national distribution centre in South Marston Park, Swindon. The seller was property investment and development group IM Properties, and the purchase price was GBP22mn (USD36.31mn). The acquisition reflects a net initial yield of 6.5%. LondonMetric's existing resources will be used to fund the acquisition. The asset consists of a 302,000sq ft warehouse that has a planning consent for an additional 150,000sq ft of distribution space. IM Properties was advised by Cushman & Wakefield, while CBRE advised LondonMetric on the transaction.
- US-based alternative asset manager Ares Management, along with UK-based Sovereign Land and Shepherd Construction, has sold Trinity Walk Shopping Centre in Wakefield, West Yorkshire, England, to Orion European Real Estate Fund IV. The 550,000-square-foot asset was reportedly sold for GBP160mn (USD264.69mn). Ares Management was represented by CBRE, and Orion Capital Managers was represented by Savills during the transaction.
About Fast Market Research
Fast Market Research is a leading distributor of market research and business information. Representing the world's top research publishers and analysts, we provide quick and easy access to the best competitive intelligence available. Our unbiased, expert staff is always available to help you find the right research to fit your requirements and your budget. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.
Browse all Business research reports at Fast Market Research
You may also be interested in these related reports:
- United States Real Estate Report Q2 2014
- United Arab Emirates Real Estate Report Q2 2014
- Russia Real Estate Report Q2 2014
- Croatia Real Estate Report Q2 2014
- Saudi Arabia Real Estate Report Q2 2014
- Pakistan Real Estate Report Q2 2014
- Germany Real Estate Report Q2 2014
- South Korea Real Estate Report Q2 2014
- Japan Real Estate Report Q2 2014
- Australia Real Estate Report Q2 2014