Commercial property in London continues to see a growing amount of interest from overseas, Northbeach Property has revealed. According to the developer, commercial properties located in the City are proving to be especially sought after, Gulf News reports.
Adam Blaskey, Northbeach’s managing director, said many of these buyers are coming from locations in Asia, such as China. ‘Prime central London has seen values recover quickly and gone beyond their previous peaks due to an inherently constrained supply.’ he commented.
Mr Blaskey added that Chinese investors also appear to be primarily interested in London’s residential property market although there is interest in the commercial market as well, especially in places such as Chelsea, South Kensington and Knightsbridge. Blaskey stated: ‘Investment by Chinese and Asian buyers is predominantly focused on the central London residential market, but there is also interest in commercial property as well, especially in the City.’
The observations come after the Royal Institution of Chartered Surveyors said London’s commercial property market is showing a ‘more positive picture’ than other parts of the UK.
Office space was said to be performing particularly well, as it outpaced areas such as industrial and retail properties.
Commercial property asking prices in Prime Central London are 6% higher in the first quarter of 2011 compared with the 2010 quarterly average, new research from CB Richard Ellis (CBRE) has revealed.
Domestic demand is beginning to play a more significant role in the market, but the recovery is still being largely supported by interest from overseas. CBRE’s latest findings show that 45% of all off plan sales in the Far East happened in Hong Kong, with a further 35% in Singapore.
However, the ongoing strength of the market largely depends on London remaining a globally attractive place to do business, the report points out. Despite its bad press, new taxes on wealth in the UK are unlikely to have a significant negative impact as the fundamental attractions like political stability, work/leisure mix and education remain strong.
‘International demand is likely to be further buoyed by recent turbulence in the Middle East and by rising inflation in Asia. These uncertain times make London property more attractive, even before considering the favourable exchange rates and the underlying investment credentials,’ said Jennet Siebrits, head of Residential Research at CBRE.
