Investment market in brief

Big Nine Investment Market in brief

Overseas investors dominated office investment in Q1, accounting for almost three quarters of total spend across the Big Nine markets.

During the first quarter of 2022, the Big Nine regional office markets saw office investment of £755 million, reflecting a 21% increase from Q4 2021 and a 25% uptick against the 10-year average. Three overseas deals completed in excess of £100 million which led to overseas investors accounting for 74% of total volumes across just six deals. Future proofed, well-located, good quality assets with a strong tenant base proved to be popular, particularly those that meet net zero carbon investment criteria, promote occupier well-being, and fulfil expectations for positive rental growth.

This is highlighted by the most significant deals of the quarter. Spanish investment firm Pontegadea Group purchased 177 Bothwell Street, Glasgow at the beginning of March for circa £215 million. 177 Bothwell Street has a high focus on occupier well-being as the first office in Scotland to feature a roof top running track and has already been pre-let to Virgin Money, BNP Paribas, AECOM, CBRE and Transport Scotland.

In Bristol, US Investor Barings acquired the Soapworks offices scheme on Straight Street for £126 million, reflecting a net initial yield of 4%.

The Soapworks project will comprise two new buildings alongside the restoration of the Grade II-listed former soap factory, with planning consent for 154,000 sq ft of flexible office space as well as 243 build-to-rent apartments, hospitality, and leisure space. Meanwhile, in Leeds, the White Rose Office Park was purchased by Belgian investor Immobel, for £110 million which reflected a net initial yield of 6.75%.

Driven by the largest deals of the quarter, Glasgow and Bristol accounted for the majority of big nine investment, accounting for 28% and 25% respectively. During Q1 Manchester and Liverpool experienced yield compression both moving down by 25 basis points. As a result, the big nine average yield moved from 5.36% at the end of last year to 5.31% at the end of Q1 2022.

According to the MSCI monthly index, average equivalent yields for all regional offices reached a cyclical low prior to the pandemic of 6.9% in January 2020 and moved out to 7.5% by the end of the year. During 2022 the MSCI monthly index has moved out slightly and ended March at 7.6%. With demand focused on the best quality assets and secondary property not trading as strongly as pre-pandemic, the yield gap between prime and secondary property continues to widen. According to the MSCI quarterly index, it was 280 basis points at the end of December, compared to 228 at the end of 2019.

Mark Williams Principal and Managing Director

Regional Investment


£754.9 million ▲25%

Up on the 10 year quarterly average

















UK property company


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