Strong property investment pipeline suggests positive second quarter

Chancery House, near Belfast's Law Courts and Victoria Square shopping centre, was sold recently for £1.685 million

INVESTMENT in the Northern Ireland commercial property market in the first three months of this was lower than the same period in previous years but a strong pipeline should see figures improve through the rest of the year, according to the latest edition of Lambert Smith Hampton's Ireland Valuation Bulletin.

The total investment figure in quarter one was £11.6 million, with transactions mainly driven by the retail sector. This is down from £69 million in the same period last year.

But despite the low level of activity, good quality stock performed well in the first quarter and attracted multiple expressions of interest as investors adopted a ‘flight to quality' strategy.

Prime yields in Northern Ireland have remained stable in the last three months, Lambert Smith Hampton said.

Notable transactions in the retail sector included Iceland investments on Belfast's Antrim Road (£1.3m) and Newtownards Road (£1.325m), and a Next investment on Church Street in Coleraine (just shy of £1m).

In the office sector, Lambert Smith Hampton sold Chancery House in central Belfast for £1.685m while Elizabeth House sold for £1.21m in the first quarter.

In the industrial sector, Lambert Smith Hampton sold a building in Duncrue Industrial Estate, which is currently let to Speedy Hire, for £1.1m.

Darren Fitzsimons, regional head of valuation at Lambert Smith Hampton, said: “In Northern Ireland investment activity has been low in quarter one principally due to a restricted supply.

"But we are aware of around £200 million of deals in legal processes or where there is a sale agreed paving the way for a significant increase in activity as the year progresses.

“We expect investment volumes to be higher in quarter two, with retail likely to dominate yet again. There are also a number of small industrial investments (over £3m) that are currently sale agreed.”

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