CBRE predicts a strong year for investment in Northern Ireland.
The advisory firm says that most transactions during 2017 will come from financial restructuring and investors consolidating profit through asset management initiatives.
Gavin Elliott, director, capital markets at CBRE, said: “We are anticipating a number of major investment transactions that were stalled by the radical events of 2016 to complete in early 2017.
“The investment market in Northern Ireland will see healthy interest from a broad spectrum of investors including private equity, property companies, high net-worth individuals and institutional investors.
“We have now entered a period of political uncertainty where the investment market will be more focused on core income and strong investment fundamentals. However, we believe that commercial real estate will continue to be favoured and viewed as a safe haven compared with other asset classes.”
The dip in 2016 investment volumes to £248m from £400m in 2015 was believed to be due mainly to Brexit uncertainty and smaller-sized opportunities for sale than previous years.
Few institutional investor deals completed during 2016, as more private equity groups, local high net-worth individuals and property companies acquired assets such as Damolly Retail Park in Newry, which was sold to Newry-based MJM Group for more than £30m.
Elliot added: “With a strong occupational market, low interest rate environment and inflationary pressures on the horizon, the appetite for commercial real estate is expected to be buoyant across 2017. With the proposed reduction of corporation tax to 12.5% in April 2018, NI is now a very attractive location for investment.
“The availability of funding became a key factor in 2016 with a notable increase in support lending from both UK and international banks in key investment transactions. The willingness of lenders to support investors is increasing and will play a key role in influencing developers to undertake new projects in 2017.”
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