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UK investment market continues to recover10th April 2012

Further evidence of economic green shoots has emerged from an encouraging new survey into property investment by global real estate services firm Cushman & Wakefield. The survey shows that income return from investments (yields) are beginning to recover.

Scott Rutherford, head of Cushman & Wakefield Birmingham

Prime property yields averaged 5.75 % in February and were unchanged on the month – ending a losing streak that started last August. However, prime yields have moved out by only 7 basis points since their low point last year and stand roughly in line with their ten year average (5.72 %). 

Overall, prime yields are still 133 basis points higher than they were before the credit crunch hit, but the scale of recovery varies significantly around the market, with London ahead of the rest of the country.

Despite this, Birmingham remains as one of only three UK centres ranked in the top 50 global markets in terms of activity in 2011, the others being London and Manchester.

Birmingham is ranked 49th globally, with volumes of £1.2bn (3.6 % of the UK total). Birmingham’s strength remains in the industrial market, where it is in the number two spot with a 7.5 % market share. In this sector, London accounted for just over a quarter of all activity in 2011.

Scott Rutherford head of Cushman & Wakefield’s Birmingham office, said: “London accounted for 57 % of all UK trading in 2011 and is understandably a global hub for retail and commerce. However, it is encouraging to see is that the regions are now beginning to benefit from investment activity, with global investors chasing assets all over the UK, including the West Midlands.
 


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