South West real estate investment volumes rise by 23% to £1.5bn in 2014

By Anita Jaynes on 18 February, 2015

New data released by leading property consultancy JLL shows that direct real estate investment in the South West hit £1.5bn in 2014, up 23 per cent on the previous year.

The figure included the sale by Land Securities of a 50 per cent share of the Cabot Circus shopping centre in Bristol to Axa Real Estate in a £267.8m deal, the largest single transaction in the region in 2014. JLL advised Land Securities on the agreement.

The launch of Skanska’s 66 Queen Square, which is being jointly marketed by JLL, has kick-started investor interest in the region for 2015, says Olly Paine, director, capital markets in JLL’s Bristol office.

He added that real estate investment in the region would have been even greater in 2014 if hadn’t been for a lack of stock in the first half of the year. “The sale of half of Cabot Circus gave the South West’s real estate investment figures a real boost last year, while investment was further driven by the purchase of £140m worth of Bristol city centre offices.

“Looking ahead, we expect the development pipeline will continue to provide the quality product needed to drive investment in the region and we are currently advising a number of developer clients on exciting projects throughout the region which will be of great benefit to our towns and cities.”

Direct real estate investment in the UK hit a record £65 billion in 2014, 3% higher than the pre-recession peak in 2006 and 16% higher than 2013’s total of £55billion. The UK is the second largest commercial property market in the world, and now accounts for 18% of all global transactions.

One of the major drivers of growth in UK investment volumes was capital flows into the UK regions, which hit £28bn, a 70% rise from the previous year and the highest on record.

Direct real estate investment in the South West region accounted for 5.3 per cent of all direct real estate investment into the UK regions in 2014.