The international commercial property market

2nd November 2016

Immediately after the Brexit vote it appeared that the commercial property market had not seen a great deal of change and many deals were still being made, from both national and international investors. However, as the move towards leaving Europe gets closer it seems that confidence in commercial property is slipping and many companies are beginning to consider investing abroad. So, if you are considering moving your business abroad, just where should you be looking?

London has always been a favourite city for commercial property investment, however, just recently it has been overtaken by New York which has been named as the best city for overseas investors. It has been reported that foreign investors spent approximately $25 billion on commercial real estate in New York in 12 months from June 2015, in the same period sales fell $14 billion in London. It is widely agreed that this growth is likely to be related to the strength of the dollar and Brexit concerns even before the decision to leave was made. It seems that New York may well be the place to move your business if you are planning on leaving the UK.

Surprisingly, Ireland has become a potential commercial property investment spot. There have been more than 150 property sales over €1 million in the first nine months of the year, it has been reported that the transaction have totalled almost €3.2 billion between them. Activity in the Irish investment market has been incredibly strong in 2016 and it appears that there has been no discernible impact on the Irish commercial property market following EU referendum. It appears that the decision has in fact strengthened the market as several Euro-dominated businesses have made the move to the country. Perhaps if you want to remain closer to home Ireland is the place to take your company.

The southern hemisphere has also seen a strengthening in its commercial property market with the Australian market at its strongest for over two years. The average investment in commercial property is $47 million, with most deals taking place in Sydney and Melbourne. Foreign investment has also increased a great deal in Q3, going from $2 billion in Q2 to £4.9 billion in the following quarter. It is thought that overseas interest has been helped by the EU referendum but also due to its high rental yields which has brought in a great deal of foreign interest. Although it is a dramatic move, it could be the perfect opportunity to make a profitable investment in commercial property.

Tony Freeman
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