Q2 SE Office Market Snapshot

By July 2018 Insight
  • Q2 2018 was a subdued quarter, with investment volumes up on Q1 but 32% down on Q2 2017 and down on the 5-year Q2 average
  • In terms of numbers of transactions, Q2 2018 was 46% down on Q2 2017 and 47% down on the 5-year average for Q2
  • The above two stats. mean that Q2 2018 has been one of the quieter Q2’s for the past 5 years, however this is in part due to unfortunate timing, as there is c. £525m of stock currently under offer, as well as a sizeable volume of stock being marketed, which should boost the Q3 investment volumes
  • This quarter has been marked by the return of the Councils, lead by Runnymeade Borough Council, who acquired Pine Trees, Staines and the VW Financial HQ in Milton Keynes for a combined £130.85m
  • Institutional funds have remained active, carrying on the trend seen from Q1
  • Private Equity Managers & Investment Managers continue to actively seek core + & value add stock but remain frustrated by the lack of opportunities
  • We are seeing an increasing polarisation in the levels of interest achieved for assets coming to the market – either experiencing competitive bidding or little interest – which is reflective of investors’ targeted requirements and rigid mindsets
  • We believe that investment sentiment is lagging occupational sentiment – which is unusual – as typically investor sentiment is stronger