Invest NW: Michael King, GVA
•Download as PPTX, PDF•
1 like•969 views
Michael King, head of valuations at GVA Manchester, outlines the state of the region's investment market
Recommended
Recommended
More Related Content
Similar to Invest NW: Michael King, GVA
Similar to Invest NW: Michael King, GVA (20)
More from Place North West
More from Place North West (20)
Recently uploaded
Recently uploaded (20)
Invest NW: Michael King, GVA
- 1. Date Month Date Month gva.co.uk A Bilfinger Real Estate company Property Market Overview 13 October 2014 Michael King FRICS, Senior Director
- 2. The Macro Picture & Trends Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 3. Values – where are we now? - All property capital values are 29% below 2007 peak but 26% above 2009 low. Rental values are now rising modestly. Source: IPD, GVA 180 160 140 120 100 80 60 40 Index, November 2013=100 Capital Values Rental Values Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 4. Yields & Interest Rates 9 8 7 6 5 4 3 2 1 0 % IPD Initial Yield 5-yr Swap Rate 5-15 Year Gilt Yields Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 5. Prime vs secondary yields - The gap between all property prime and secondary property yields has widened significantly, but is now starting to narrow. 14 13 12 11 10 9 8 7 6 5 4 Yield (%) 200 basis points 499 basis points 562 basis points Lowest yield quartile ('prime') UK average Highest yield quartile ('secondary') UK average Source: IPD, GVA Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 6. Development activity - Dramatic fall in new commercial development - worse than in each of the last two recessions. Recent improvement is the start of expected strong upturn in activity. Source: ONS, GVA Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 7. Property returns & capital value growth - Outlook is for a 20% total return and 14% capital value growth in 2014. 20 10 0 -10 -20 -30 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Annual Change (%) Total Returns Capital Value Growth Source: IPD, REFL, GVA Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 8. Net Investment by Type of Buyer 14 12 10 8 6 4 2 0 -2 -4 -6 -8 -10 -12 -14 2006 2007 2008 2009 2010 2011 2012 2013 £bn UK Institutions Quoted Prop Co Private Prop Co Overseas Investors Private Individuals Corporate Others Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 9. The Office Sector Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 10. Office Rental Growth 20 15 10 5 0 -5 -10 -15 -20 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 % pa All Property Central London Offices NW Offices Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 11. Overview of the UK Commercial Property Investment Market Example Transactions - Offices Chancery Place, Manchester Vendor: Private Investor Purchaser: NFU Mutual Price: £57,000,000 Yield: 5.05% NIY Comment: • 106,000 sq ft • Multi let • 2 vacant floors on rental guarantees • £537 per sq ft Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 12. Overview of the UK Commercial Property Investment Market Example Transactions - Offices Ship Canal House, Manchester Vendor: HIMOR Purchaser: Ardstone Capital Price: £26,000,000 Yield: 6.25% NIY Comment: • 72,544 sq ft • Multi let • 2 vacant floors • £358 per sq ft Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 13. The Retail Sector Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 14. In-town Retail Rental Growth 8 6 4 2 0 % pa -2 -4 -6 -8 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 All Property Unit Shops Shopping Centres NW Unit Shops Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 15. Out-of-town Retail Rental Growth 12 10 8 6 4 2 0 -2 -4 -6 -8 -10 -12 -14 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 % pa All Property Retail Warehouse Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 16. Overview of the UK Commercial Property Investment Market Example Transactions - Retail In Town 7-9 Piccadilly, Manchester Vendor: W K Nolan Associates Purchaser: Henderson Global Investors Price: £8,200,000 Yield: 6.34% NIY Comment: • 22,000 sq ft • Overriding lease to Superdrug Stores • Expiry 2022 Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 17. Overview of the UK Commercial Property Investment Market Example Transactions - Retail In Town 17-19 Church Street, Liverpool Vendor: Friends Life (AXA) Purchaser: Vabeld Limited Price: £7,150,000 Yield: 5.75% NIY Comment: • Prime retail pitch • Let to Vodaphone • 2019 lease expiry Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 18. Overview of the UK Commercial Property Investment Market Example Transactions – Foodstore / Retail Warehouse Tarvin Road, Chester Vendor: LPA Purchaser:Private Price: £8,500,000 Yield: 5.35% NI Comment: • 38,000 sq ft • Overriding lease to Aldi Stores Limited • 20 year lease with 2.5% pa compounded revenues Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 19. Overview of the UK Commercial Property Investment Market Example Transactions – Foodstore / Retail Warehouse Ashfield Road Retail Centre, Burnley Vendor: The Gregory Group Purchaser: Private Investor Price: £4,750,000 Yield: 6.71% NI Comment: • 25,500 sq ft • Let to Homebase Limited • OM reviews with 15.5 years unexpired Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 20. The Industrial Sector Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 21. Industrial Rental Growth 8 6 4 2 0 -2 -4 -6 -8 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 -10 % pa All Property UK Industrial NW Industrial Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 22. Overview of the UK Commercial Property Investment Market The Qube, Liverpool Vendor: Private Purchaser: Best Bids Price: £36,250,000 Yield: 5.5% NIY Gross Comment: • Prime distribution • 500,000 sq ft • 20 year lease to B&M Example Transactions - Industrial Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 23. Overview of the UK Commercial Property Investment Market Example Transactions - Industrial Hermes Parcelnet, Omega, Warrington Vendor: Omega, Warrington Purchaser: LaSalle Investment Management Price: £17,20,000 Yield: 6.5% NIY Comment: • Distribution funding • Pre let Hermes Parcelnet • 20 year lease c. £1.18m pa rent Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 24. North West v UK Returns Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 25. UK Sector Returns 25 20 15 10 5 0 -5 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 -10 -15 -20 -25 % pa UK Retail UK Offices UK Industrial Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 26. North West Sector Returns 25 20 15 10 5 0 -5 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 -10 -15 -20 -25 % pa NW Retail NW Offices NW Industrial Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014
- 27. Conclusions • Prime yields and values at pre crash level • Offices and industrial outperforming retail • Structural change in the high street but leisure performing well • Lack of development activity = lack of supply – potential for rental growth • London & south east overheating • Money not the problem – stock is!!! Short presentation title here / November 2010 gva.co.uk Place North West – 13 October 2014