The level of commercial property activity in the East Midlands in the second quarter of the year was four times the figure for the first quarter, according to new figures from national commercial property firm Lambert Smith Hampton (LSH).
The big increase was driven by significant rises in both the industrial and office sectors, while transaction activity in the retail sector remained steady at around £28 million.
Overall activity across all sectors in the East Midlands peaked at £210 million in the second quarter, compared to £51 million in the first three months of the year. Industrial transactions accounted for £75 million of the increased figure, driven by Cabot Properties’ acquisition of Unit 5, Logix Park, Hinckley for £23.22 million and Teal Park in Lincoln which was acquired by a Middle Eastern investor for £20 million.
In the office sector £34 million was transacted compared to £17 million the first quarter, with the largest deal being Topland Group’s purchase of Lakeside House, Northampton for £17.7 million. This deal represented a Net Initial Yield of 8.65 per cent, with an immediate reversion to 9.78 per cent.
LSH’s quarterly analysis of the market showed that the East Midlands was one the few regions in the country to see an increase in activity, joined by the West Midlands, the south west and north east.
Geoff Gibson, Director of the Leicester office of LSH said, “Some economic indicators are improving in the region, and this is creating increased take-up and demand, particularly in industrial. In addition, there is some high quality office space available in the East Midlands which is taken up quickly when it comes to market.”
He added, “The East Midlands has performed well relative to many other areas of the country where activity is muted at best. When good quality assets come to market, they find buyers quickly, and the lack of prime office space in the West Midlands is almost certainly benefiting the East Midlands. However, concerns over the economy at home and abroad, and lack of occupier demand for secondary stock, means we must take a cautious view of the market going forward.”
Across the UK, £7.8 billion of transactions were recorded in the second quarter of the year, a slight increase on the first quarter of last year.
