Commercial Property Investment
20th September, 2006
ECB interest rate hikes do not appear to be dampening demand for prime commercial property investment opportunities, according to new research.
The latest research from property consultants CB Richard Ellis shows that Irish investors are on course to invest over €10 billion in commercial property in 2006.
CB Richard Ellis said that having peaked at more than €2 billion in 2005, investment in the domestic market is set to reach record levels of €2.7 billion this year.
The bulk of Irish investment spend in 2006 will be in the UK, with the company’s latest report on Irish property investment trends indicating investors spent over €3.5 billion in the UK in the first six months of 2006, despite the difficulty in sourcing good quality investments.
Marie Hunt, of CB Richard Ellis suggests that Irish investors will invest more than €5 billion in the UK this year.
The company said that the latest figures demonstrate that ECB interest rate hikes do not appear to be dampening demand for prime property investment opportunities.
Irish investors also continue to spread their wings in European commercial markets.
Caroline McCarthy, director of CB Richard Ellis, said the research indicates that in the first half of the year Irish investors completed 83 investment transactions outside Ireland, of which 60 were UK-based.
Outside the UK and Ireland, in the first six months of this year, Irish investors spent over €1 billion on commercial investment properties mainly in Spain, Germany, Belgium, Poland and France.
Almost half of the transactions outside Ireland were office properties, 33% were in the retail market, 11% comprised industrial properties and 9% were mixed-use properties.
Looking forward the company predicts un-geared returns of 20% in the Irish commercial property market this year, “which will no doubt attract investors to the commercial property sector in the short to medium term”.