Commercial property market gets back to business as usual

The Beannchor Group's new Bullitt Hotel is among several currently in development for Belfast

QUIET summers are nothing new for the commercial property market. Indeed, everyone working in the industry will be well aware of how July in particular is a month which sees very little transactional activity.

This summer has been no different, with very few deals being completed or significantly progressed. As we all know, however, July 2016 had a very different context to every preceding year with the historic vote by the UK to leave the European Union at the end of June.

There's no doubt the referendum result, coming as such a major shock as it seemed to for the majority of the Northern Ireland business community, created an unnecessary hysteria and panic about what the future holds for the local commercial property market.

In the immediate aftermath, those wishing to paint a picture of a market destined for a crash similar to that experienced during the economic recession had plenty of ammunition, given that this July was possibly even quieter than normal.

However, more than a strong hint of normality has returned to the market in recent weeks, with August in particular seeing the business pages of this newspaper and many others reporting a series of deals across a range of sectors which provide evidence that the market is very much alive and well.

The office market has long been a talking point and the fundamentals of lack of supply and continued demand have not changed. As an indication that this sector continues to be active it was revealed earlier this month that the General Accident building on Donegall Square South is set to be demolished and replaced with the construction of a new nine-storey office development.

It's also notable that Kilmona Holdings, McAleer & Rushe and Stargime continue to press ahead with their proposed developments at various locations in Belfast, including Queen's Square, Victoria Street and East Bridge Street.

Positive news has also engulfed the hotel sector this month, with more than 20 hotel projects currently at various stages of development across Belfast – the most recent of which being work commencing on Northern Ireland's first ever Marriott hotel at the City Quays development in Belfast Harbour.

The new, £4 million Bullitt Hotel is also due to open in the city centre in October, while the last fortnight has also seen planning being approved for a four-storey boutique hotel at Bank Square in Belfast city centre and a four-storey extension to the Holiday Inn Express on University Street, which will provide 60 new bedrooms.

The launch of the second phase of luxury, newly-refurbished apartments at the Obel complex in Belfast city centre, the latest stage of a £2m upgrade of Ireland's tallest building, is a high-profile example of the growth being enjoyed by the residential market.

This is confirmed by the latest Northern Ireland House Price Index report revealing that the house price index increased by 3.8 per cent between Q1 and Q2 of 2016.

There's no denying that the uncertainty in the wake of the Brexit vote did not help the market, but the over-reaction to it has now hopefully ended and we can carry on with business as usual.

:: Declan Flynn is managing director of Belfast-based commercial property agency Lisney, which works on behalf of many of Northern Ireland's most significant investors and developers as well as major retailers and businesses

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