Findings from our latest UK Investment Transactions (UKIT) report show that the total value of commercial property investment transactions across the North West increased in Q4 2012 to £282m from £215m in the previous quarter.

Across the region, this represented an increase of 31% from Q3 2012, but considerably below Q4 2011 levels of £557m.

Demand remains focussed on prime stock

In 2012 as a whole, £881.64m of transactions were recorded across the region, highlighting a 68% drop in activity from 2011’s figure of £2,779.8m. A major reason for this being the Trafford Centre deal in Q1, which alone accounted for 61% of total activity across the North West in 2011

The most significant deals to take place during Q4 included Land Securities’ acquisition of The Printworks in Manchester for £93.9m, F&C Reit Asset Management’s acquisition of The Lanes Shopping Centre in Carlisle, Cumbria for £65m and Brockton Capital LLP’s acquisition at Riverside Retail Park in Warrington comprising 159,996 sq ft of retail space for £30.8m.

Retail and leisure sector dominates the market

The retail and leisure sector continued to dominate the market with £218.10m worth of transactions, accounting for 77% of total investment activity in Q4 2012, a 14% increase from Q3. The office sector, which accounted for 17% of the total market in Q3 2012, fell to 13% in Q4 at £36.15m.The industrial sector remained steady, accounting for 10% of the Q4 market at £27.39m.

Abid Jaffry, LSH’s Northern Head of Capital Markets commented:
“A combination of investor caution and lack of tradeable stock still predominate the market but there continue to be large scale investments for significant assets demonstrated by Land Securities purchase of The Printworks and F&C Reit Asset Management’s acquisition of The Lanes Shopping Centre.”  There remains a ‘hole’ in the market which was otherwise filled by the debt purchasers where most trading took place and so a key stimulus to activity is likely to be missing for the foreseeable future with investor demand remaining focussed on prime stock.

To view our full UK Investment Tansactions (UKIT) report, please click here.