The results that were released in CRBE's latest quarterly report show that investment transaction volumes are 59 per cent higher for the first nine months of 2023 compared to the same period in 2022.
Brian Lavery, Managing Director of CBRE NI, said: "During the first three quarters of this year, there has been £277 million transacted in the commercial investment market in Northern Ireland, with spending in the past three months alone reaching £122m.
"Retail investment witnessed the highest level of business over the period, accounting for 71% of all activity across the year.
"These are encouraging signs however the majority of the spend is locally sourced as we continue to see the decision-making of external investors into all sectors negatively impacted by local geopolitical factors."
The findings in the report include:
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• Retail properties accounted for the largest transactions in Q3 with Forestside Shopping Centre and Abbey Retail Park changing hands for £42m and £40m respectively.
• The hotel sector has also been positive with the off-market purchase of The Hilton Belfast by Pandox AB for a reported £40m, the largest hotel transaction ever completed in the city.
• Hotel occupancy is now slightly exceeding 2019 levels while Average Daily Rate (ADR) continues to achieve record highs.
• The industrial and logistics market has been slow which is in keeping with trends over the summer months but notable deals include an agreement to lease 100,000 sq ft in Lisburn on a design and build basis.
• The take up of office space for Q3 was recorded at 38,149 sq ft, representing a substantial reduction on both the Q1 and Q2 figures of 43% and 54% respectively.
• Since the start of the year, high-net-worth domestic investors have comprised 75% of the total investment spend.
Challenges for the industry include a large amount of secondary stock in the office market that will require significant investment to bring it up to the required standard in regards to sustainability and finishes.
Mr Lavery said in order to ensure the feasibility of these projects, CBRE "envisage many of these buildings will have to be converted to alternative uses such as student accommodation or build-to-rent".
Looking to the future, Mr Lavery stated: "Looking ahead, we anticipate the volume of deals in the fourth quarter to be lower than the most recent three months with transactions not yet in legals unlikely to complete before the end of the year.
"We will also continue to keep a close watch on interest rates, now expected to be at or reaching their peak, having negatively impacted investment pricing across all sectors over the last 12 months."
