Investors Return on the UK Commercial Property Market

Latest Wall Street Journal report suggests that as the London market of commercial property is starting to recover, UK and foreign investors start to look for deals.rnInvestors who were able to purchase London properties at attractive are now successfully finding sellers. The most vivid example of the activity that is going on the British commercial property market are the talks between British Land PLC, one of the largest UK property groups, and Blackstone Group LP about the sale of a 50% stake in a prime development of London offices, Broadgate. Blackstone’s insider said that the company, which closed a €3.1 billion fund earlier this year, is interested in purchasing a stake in Broadgate. rnMr. Chris Grigg, chief executive of the British Land, confirmed that several requests for a stake in Broadgate as well as in Sheffield’s shopping centre Meadowhall were received by the company. rnIn his speech at one of the recent conferences, Mr. Grigg claimed that all assets of the British Land company are being sold at a “right price”. However, in its Tuesday report, British Land said that the value of its portfolio fell by 41% to £8.2 billion since the peak in 2007. Company’s properties were also subject to a decline in rents, which had the most significant impact on shopping centres (6%), followed by offices (4%). rnDespite all the bad news, industry analysts say that the British Land company has lived through the economic downturn and stayed in the strong position. rnMeanwhile, another sign of an ongoing market activity in the commercial property sector is the potential sale of all the Equiton Industrial Partnership assets by Brixton Plc, one of the British industrial property real-estate investment trusts, to Universities Superannuation Scheme Ltd. rnAll the above-mentioned factors create an atmosphere in which investors return to the property market in the search of talks and deals.

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