New figures show
A total of £722m of London development land sales completed in the second quarter of 2017, representing the strongest quarter since before the EU referendum and a 48 per cent increase on Q1 2017, according to the latest report from global real estate advisor, CBRE.
The quarterly uplift was largely driven by overseas developers, who represented 83 per cent of development land buyers in Q2 2017. They were focused principally on large lot sizes for mixed use development. As such, there were three land deals over £100m in Q2 2017. These included the sale of Vauxhall Square to Chinese developer, R&F properties, and the sale of Elizabeth House, Waterloo to HB Reavis. Political uncertainty slowed development land sales during 2016 but the rebound in activity during H1 2017 demonstrates the re-emerging appetite for development land in the capital.
Looking ahead, the sales pipeline remains strong, with £1.5bn of land expected to complete before the end of the year, with almost all land intended for mixed-use development.
Peter Burns, Managing Director, UK Development at CBRE comments: “We expect overseas investors to remain a dominant presence in the London land market attracted by the capital’s underlying strengths whilst also capitalising on the exchange rate benefits. As this quarter has shown, there is considerable appetite for larger lot sizes from overseas buyers as well as significant demand from both domestic and overseas buyers for small lot sizes in prime locations where supply is constrained.”