City of London commercial property investment hits £572m in January

City of London commercial property investment reaches £572m in January

City of London commercial property investment volumes in January reached £572.2  million, a 55% increase on the volume recorded for the whole of the final quarter of 2022, and the best January turnover since 2016, according to Savills.

The international real estate advisor says that January 2023’s volume is 80% up on January 2022 and 13% above the 10-year average for the month (£507.61 million).

It reports that eight deals transacted during the month and that it is tracking a further 16 assets currently under offer worth a combined £1.67 billion, with a further £3.3 billion of assets available in the market.

The largest deal of the month was Chinachem Group’s acquisition, advised by Savills, of the long leasehold interest in 1 New Street Square, EC4 for £349.5 million, reflecting a net initial yield of 4.71%.

Felix Rabeneck, director in the City investment team at Savills, comments: “This has been the strongest start to the year in the City for eight years, as improving investor sentiment combined with more market data points has helped narrow the gap between vendors’ and buyers’ pricing expectations. The deals we’ve seen demonstrate London’s position as a top-tier global city for international investors and provide much needed clarity as to where prime pricing may land, which should encourage other buyers. That being said, we do anticipate that certain investors will remain cautious as the impact of Q4 valuations and upcoming debt events are felt by some.”