Birmingham offices buck the trend – Lambert Smith Hampton
Three major office deals in Birmingham totalling more than £107m accounted for more than 10% of total regional office transactions outside London last year, says Lambert Smith Hampton’s Adam Ramshaw.
The total value of office transactions outside London last year fell to £1.03bn from £1.55bn the previous year, while in the capital the total rose to £11.64bn in 2012 from £8.43bn a year earlier, the firm notes. It points out that the Birmingham total was boosted by the £40.475m sale of Baskerville House (195,000 sq ft) to Hermes; the sale of 115 Colmore Row (80,000 sq ft) for £32m to CLAL Insurance; and the £35m sale of The Cube (113,000 sq ft) to Tristan Capital.
LSH’s Adam Ramshaw expects to see more Birmingham offices deals being done during the first half of this year, and notes that two other buildings in the central business district are currrently under offer at a total price of around £16m. “Sellers and potential buyers seem to be a lot closer now on valuations and the current market represents good value and presents good opportunities for investors,” he adds.
The jump in transaction value in London meanwhile reflects the continued attractiveness of the capital’s property market to overseas investors in search of a safe haven. Prime Central London offices alone accounted for almost 40% of the transactional market in 2012, notes Lambert Smith Hampton CEO Ezra Nahome.
Lambert Smith Hampton expects the key investment trends of 2012 to persist for much of this year, with overseas investors continuing to seek prime Central London assets – although transaction volumes could be limited by availability. Ezra Nahome adds that the base of overseas investors seeking exposure to Central London is set to widen, with some of the Australian “super-funds” wanting to return to the market in 2013, for example. “However, an increase in activity is reliant on the debt being available to the investors,” he notes.
