Commercial investment volumes in the City of London for the first nine months of 2017 have already exceeded the full-year total for the whole of 2016 and could beat the record set in 2014, according to international real estate advisor Savills.
Volumes reached £8.5 bn (€9.54 bn) as the end of September – 6% higher than 2016’s annual total of £8.07 bn (€9.06 bn) and 58% up on the same point last year.
'As of the end of the third quarter, Savills had been directly involved in almost 40% of total turnover in the City this year, the largest of any investment agent. We are still currently monitoring 67 investment opportunities in the City market totalling approximately £7.8 bn (€8.76 bn), of which 20 are currently under-offer, totalling almost £1 bn,' commented Felix Rabeneck, director in Savills central London investment team.
With an average turnover in the final quarter over the last five years of £4.1 bn (€4.6 bn), Savills predicts that total City turnover in 2017 could reach or surpass the record of £12.6 bn (€14.14 bn) set in 2014. 93 deals have been transacted this year, with an average lot size of £91.6 mln (€102.8 mln), according to Savills, compared to an average of £52.4 mln (€58.8 mln) in 2016.
September saw £317.53 mln (€356.46 mln) transacted across three deals, equating to an average lot size of £105.84 mln. Key deals during the month included a private Hong Kong investor acquiring Aldwych House WC2 (pictured) for £250 mln (€281 mln) from Rowan Asset Management, reflecting a NIY of circa 4.42% and £1,417 per ft2. The building is let to tenants including WeWork, Wasserman and the London School of Economics.
September also saw the sale of 8 Bouverie Street, EC4 to Harbor Group International for £48.03 mln (€53.9 mln), reflecting 4.12% NIY and £1,004 per ft2. The building is single let to Tipall Ltd with a surety from Euromoney Institutional Investor Plc, and has an unexpired term of 11.9 years.
