As a residential and commercial property specialist, Simon Morris uses his expertise to show UK property investment funds how to maximise returns on their property portfolios.
This week it was reported that Central London Commercial property transactions reached £2.5bn, year-to-date this is a staggering £15.4bn worth of investment with still around a month to go until the end of the year. This will most likely make 2014 the most active year on record.
While investment volume is likely to fall short of 2013 (a record £22.4bn) the tempo and volume of trading has been unmatched.
Lack of high value stock
The largest transaction in November was made by the Safra family who paid £725m for 30 St Mary Axe, EC3. Eight lots transferred with price tags over the £100m mark including the Metropolitan Police HQ at 10 Broadway, SW1.
While some feel that the market is being held back by a lack of high value stock, this can be seen reflected in the fact that three out of four £100m+ transactions took place off market.
Good prospects for income growth
Research from DTZ reveals that there is potentially £89bn of capital currently targeting European real estate. This includes private and institutional investors. London, especially at the £100m+ end of the market still has better liquidity than most other markets.
London, or course still offers good prospects for income growth. Some submarkets have even seen double digit income growth over the last year. The last few months of 2014 have seen record rents recorded in King’s Cross and the City of London. It’s currently rumoured that an oil giant is looking to sign a deal at 30 Berkley Square with a square footage price of £150, the highest rent ever paid in UK office history.
About Simon Morris
Simon Morris is an independent property advisor working with Funds and Investment Companies to ensure property chosen for funds and portfolios delivers agreed return based on low risk.
For more information on property investment vehicles please read the Guide to Property Investment Options.