Real estate group hails Northern Irish commercial property market

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Commercial property and real estate service advisor CBRE claims in a recent report that annual rents achieved for Northern Ireland commercial property are the highest in the UK.

Andrew Marston, CBRE’s director of the UK office and industrial research, says that rising interest rates in many countries are negatively affecting commercial property yields. Whilst interest rates have risen slightly in Northern Ireland and made commercial mortgages more expensive, Marston believes that this has not eroded high rental yields in the commercial property sector.

In Belfast, the biggest recent sale was the CastleCourt Shopping Centre that sold for £123m to Chinese-backed investors. In the UK, the retail property market has slowed down, but in Northern Ireland, rental yields of 5.75% can be achieved by investors in high street shops. This compares to 4% in other UK regions and 3.15% in the Republic of Ireland.

Office space in Northern Ireland can achieve 6% yields, compared to 4% in London and 4% in Dublin.

Tourism has risen in Northern Ireland and the hotel sector is growing.

CBRE believes that the success of the Northern Ireland property market is dependent on the success of the whole economy and a vibrant society. The main issue that could negatively affect the economy is the shortage of strong Irish political leadership, which CBRE feels is lacking at both local and national levels. This can put off some overseas property investors.

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