A total of £10.9bn was invested in UK commercial property during Q2, in line with the previous quarter, according to Carter Jonas’s latest Investment Quarterly.
However, transaction activity remained subdued, with 351 deals completed in the quarter. Investment in the main commercial markets remained below five-year quarterly averages, with industrial investment 54% below average, retail down 47% and offices down 25%. By contrast, alternative sectors outperformed, with volumes 43% above the five-year average.
Overseas investors accounted for 53% of total UK commercial property investment in Q2 with US capital leading the way. In London, overseas investors accounted for 46% of capital deployed.
Ali Rana, head of national investment at Carter Jonas, said: “As we move into the second half of the year, uncertainty has once again moved to the forefront of investors’ minds. Escalating tensions in the Middle East have increased volatility across global markets and raised concerns that higher energy prices could place renewed upward pressure on inflation.”
He added: “Looking further ahead, pricing has broadly stabilised, financing conditions have continued to improve and investor confidence is gradually rebuilding. Although geopolitical risks are likely to remain elevated, the overall investment backdrop is more constructive than it was a year ago.”
