London property investment set for record year
Commercial real estate investment in the City of London is set to match or surpass the £12.6 billion record set in 2014, according to new figures released by Savills.
The global real estate giant has revealed that property investment in the Square Mile for the first three quarters of 2017 has already beaten the overall annual total of £8.07 billion achieved in the previous 12 months by six per cent, with investments reaching £8.5 billion by the end of September.
According to Savills figures, more than 90 real estate investment deals have already been confirmed in the City in 2017, with an average figure of £91.6 million compared to the 2016 average of £52.4 million.
September significantly boosted the total, with three major investments achieving a total figure of £314.53 million. One of these deals saw the acquisition of the 176,392 square foot Aldwych House by a private Hong Kong investor for £250 million. The building is currently home to a number of commercial tenants including WeWork, Wasserman and the London School of Economics.
This isn't the first property in London to have benefited from the rising interest of Hong Kong real estate investors, who have recently flocked to the City to take advantage of stable rental incomes and cheaper money in the UK.
According to Hong Kong-based real estate firm Tenacity, the uncertainties surrounding the Brexit process have also made London a more attractive prospect due to low property prices and the opportunity for lucrative long-term investments.
Last month, the City of London also saw the sale of 8 Bouverie Street to Harbor Group International achieved £48.03 million, which made another significant addition to an already impressive September investment total. The building is currently let to Tipall Ltd and has an unexpired term of 11.9 years.
Felix Rabeneck, director in the central London investment team for Savills, who oversaw almost 40 per cent of property transactions in London this year, suggested that the firm was pleased with the recent success, as well as the predicted success of this lucrative area in the coming months.
He said: "We are still currently monitoring 67 investment opportunities in the City market totalling approximately £7.8bn, of which 20 are currently under-offer, totalling almost £1bn, leaving a substantial amount of available opportunities and therefore plenty of potential for 2017 to overtake 2014’s record."