The sale of two Northern Ireland shopping centres and a Belfast city centre hotel will lead the new year among £50m worth of commercial property deals, it has emerged.
Bloomfield Shopping Centre and Retail Park in Bangor and The Quays Shopping Centre in Newry are both expected to trade in the first quarter of 2024.
Meanwhile, the budget Etap Hotel in Belfast city centre is also agreed for sale, according to Lambert Smith Hampton.
It also says the number commercial property transactions in Northern Ireland increased in 2023, with the highest number of deals recorded since 2018.
Some 52 deals were completed, while investment volumes for the year increased to £341.4m, 24% above the five-year average and the highest total since 2017.
“As expected, investment volumes in the final quarter of the year were subdued after a strong third quarter, with transaction levels in line with previous years but the value of deals coming in at £51.2m, 25% below the five year quarterly average,” it said.
The largest deal of 2023 was the purchase of Rushmere Shopping Centre in Craigavon for £46.5m by Killahoey Limited, while other substantial deals included the acquisition of Forestside Shopping Centre in Belfast for £42m by Mussenden Properties Limited, a company owned by Michael Herbert, and Foyleside Shopping Centre in Derry, which was purchased by a consortium of local investors for £27m.
“Despite supply issues during 2023, investment volume exceeded expectations and has been remarkably consistent between 2021 and 2023,” Claire Shaw, senior research analyst at Lambert Smith Hampton, said.
“There was also a continuing improvement in the depth of activity and a renewed interest in shopping centre assets, driven by rebased pricing and attractive returns.
“Looking into 2024, there are over £50m of deals either agreed or in legals. Continuing the 2023 trend, retail will be key to volume at the beginning of the year, with Bloomfield Shopping Centre and Retail Park, Bangor and The Quays Shopping Centre, Newry both expected to trade in the first quarter. Hotels will also make a welcome return with the ETAP Hotel, Belfast, also agreed for sale.”
And Jonathan Martin, director at Lambert Smith Hampton, said: “As we move into 2024, it’s encouraging that supply challenges didn’t lead to a reduction in volume or overall investment activity last year. The figures clearly demonstrate that investor appetite remains robust, especially amongst well-capitalised local investors who are poised to move once supply improves.
“Increased finance costs are likely to create challenges for some owners, and it is anticipated this will lead to increased stock levels, although the prospect of rate cuts later in 2024 will provide some assurance for both vendors and investors alike. The improving economic situation, potential return of the Northern Ireland Executive and the regions unique dual access positioning are all reasons to be optimistic for the Northern Ireland property market in 2024.”
Source: Belfast Telegraph (link opens in new window)