Commercial property sees £500m leap in investment

SCOTLAND’S commercial property market has turned the corner, with a big jump in sales activity in the second half of 2013 raising hopes for the current year.

Alasdair Humphery: vital that Scotland retains competitive edge. Picture: Neil Hanna

Alasdair Humphery, chairman of the Scottish Property Federation, is set to highlight the new figures at the group’s annual get-together, saying that “Scotland is open for business”.

He will point to a “growing confidence and change in the property industry as the wider economy grows and we emerge from recession”.

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Humphery, who is lead director for property agency JLL’s Scottish operation, said that commercial sales north of the Border had increased from £841 million in the first half of 2013 to more than £1.3 billion in the second half.

He said recent significant investment in Dundee, with the sale of the Overgate shopping centre, suggested that the upward trend was continuing.

The mall, which is home to some 70 retailers including Debenhams and Primark, was sold by Land Securities earlier this month to Legal & General Property in a £125m-plus deal.

But in his address to the expected audience of about 200 industry professionals, Humphery will also call for political support for the sector in order to maintain its recovery.

He told Scotland on Sunday: “It is vital that in Scotland we retain a competitive edge as the UK property markets recover. Now that investors are looking beyond London and increasingly into a wider variety of assets, it is crucial that we are able to compete effectively with other major economic centres such as Manchester.

“In this sense, the Scottish Government has a key role to play in ensuring we have a robust and competitive tax and regulatory environment and it must ensure we are not placed at a disadvantage when competing for investment with the major English cities outside of London.”

He highlighted key factors including an “efficient up-to-date planning system”, a “reformed” business rates system and a “competitive” commercial top rate of land and buildings transaction tax that is just 12 months away from coming into force in Scotland.

The conference, which is taking place at Our Dynamic Earth in Edinburgh, will feature a Question Time-style political round table including MSPs Gavin Brown, Derek Mackay and Willie Rennie, of the Scottish Conservatives, SNP and Scottish Liberal Democrats respectively.

Andy Creighton of Aberdeen Asset Management is also speaking and will focus on “real estate as an investment class in a changing world”.

Humphery said: “We know this is a historic year for Scotland where the Scottish referendum will choose the destiny of the country, but our key message is that Scotland is open for business.”

As well as an upturn in investment activity, developers are revisiting plans for major property schemes as the economic recovery gains traction.