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Value of business property deals falls

THE value of Scottish commercial property deals has slumped to its lowest level since 2001, according to research.

CBRE's quarterly analysis of the Scottish market revealed £212 million of property investment deals were completed in the final three months of 2012.

That brought the total across the year to £1.01 billion, which was 15% down on the amount recorded in 2011 and the weakest since the £919m recorded in 2001.

Across 2012, the office sector was the busiest at £426m representing 42% of deals, compared to a five-year average of 36%.

Total returns for the office sector were at -0.6% meaning Scotland performed better than anywhere else in the UK outside of London.

Reflecting difficult conditions on the high street, retail property transactions came in at £190m, 19% of all deals and well below the five-year average of 37%. Returns in retail were at -0.5% across the year with the west end of London the top performer at 13.4%

In the industrial sector, value was relatively flat at £146m, however, returns were strong. Across 2012, Scottish industrials brought returns of 3.3% compared to the UK figure of 3.3%

Aileen Knox, senior director at CBRE (Scotland), said the Scottish market had performed well in comparison to the rest of the UK and added: "Looking ahead to 2013, it is expected that the market will not change dramatically and that conditions will be similar to that of 2012."

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