Property investment in Central London has soared as £4.9bn was invested in the fourth quarter of last year
The Central London office market has revived following the result of the General Elections as commercial investment in the area soared in December. The election results have induced a level of confidence in the city’s property market, resulting in a flurry of activity.
The £4.9bn invested in the fourth quarter of last year was a 125 per cent jump on the amount invested in the previous quarter and was on par with 2018. The city’s property market was undergoing a slump in the recent past, with the capital – the UK’s traditional property hotspot – underperforming compared with other parts of the country.
However, the election results seem to have a positive impact on the property market and showed rising investor confidence with transactions worth £2.55bn in December alone.
The number of transactions worth more than £100m in December was more than those in the rest of the year combined as 16 transactions of more than £100m were completed over the period, according to CBRE research.
While the sale of the Post Building in Bloomsbury was the largest deal, the biggest transaction of the year over all was the sale of Canary Wharf’s 25 Canada Square. The Post Building was sold for £607.5m whereas 25 Canada Square for £1.1bn.
However, overall figures for 2019 fell to £11.3bn – 36 per cent down on the previous year and the lowest level since 2011, largely due to the uncertainty throughout the rest of 2019.
The fourth quarter of last year was the most active for domestic investment since 2013, as UK investors spent £2.3bn in the central London market.
Meanwhile, international investment declined from 76 per cent of the market in 2019 to 53 per cent in 2019.
CBRE head of central London investment James Beckham said that 2019 was a challenging year for the central London office investment market. A lack of stock, coupled with heightened political uncertainty that persisted all year, resulted in more hesitancy from overseas investors.
He said that however, the surge in investment in December has heralded heightened levels of confidence which is expected to continue into 2020.
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