THE property community in Northern Ireland are by nature, and often by necessity, a resilient lot - but even their patience is being tested right now.
As 2018 dawned the market continued to suffer from a combination of restraining forces, in particular the political vacuum caused by a year-long suspension of the Stormont Executive, and the on-going anxiety over Brexit.
While things have moved on greatly in the last few days, the failure of our local politicians to make real headway over the last year towards re-forming an Executive has damaged market confidence, both domestic and international, and the result is a lot of sitting on hands; a blockage of pent-up demand; and perhaps missed opportunities on the investment and occupier fronts.
The business community appears united in the expectation that Northern Ireland is ideally placed to come out of Brexit smelling of roses, if only we could grasp the opportunity – the “foot in both camps / special case” theory. It seems some politicians remain to be convinced.
There is however still a great sense of optimism that we will overcome these problems, as borne out by the number of cranes which continue to multiply on the Belfast skyline - evidence of the amount of property development and refurbishment which is emerging to meet anticipated demand.
In the hospitality sector, new hotel developments are coming out of the ground at a rate of knots. This is going to be a record year for hotel openings,
with over 1,000 new rooms already set to come on stream in Belfast alone.
The new hotel developments currently under way include Hastings’ Grand Central on Bedford Street; Easy Hotel on Howard Street; the Maldron on Brunswick Street; Hampton by Hilton on Hope Street; and Belfast Harbour’s Marriot AC at City Quays.
Other hotel developments in the pipeline include Signature Living’s George Best Hotel on Donegall Square, where Signature has just gone on-site having
invited public funding from £80,000 per room.
The Retail market is alive and well, with vacancy rates decreasing and new entrants coming into the local market. Sterling’s slide against the euro has encouraged shoppers from the Republic into the north, and the border cities of Derry and Newry in particular are seeing increased footfall.
On the industrial front there is renewed occupier demand particularly in the established distribution locations like Mallusk and the North Foreshore where rents have risen.
The office market continues show the best potential of all the property sectors, albeit constrained by a continuing lack of supply. There is considerable unsatisfied demand for grade A offices particularly at the higher end of the size spectrum.
It might sound like a broken record, but the investment market continues to suffer from a severe lack of supply, whilst demand at all levels remains strong.
A combination of the general air of uncertainty, coupled with the hope or expectation of continuing capital growth, appear to be amongst the factors which are holding some potential vendors back from going to market.
Suffice to say that any sensibly priced investments which do come up for sale are attracting competitive bidding once again.
:: Rory McConnell is a director at McConnell Chartered Surveyors, one of Northern Ireland’s oldest and most respected firms of property consultants. The full property report can be read at www.mcconnellproperty.com/filestore/file/publications/McConnellsMarketBriefing-1518181697.pdf
