Independence debate still to have impact on commercial property

The prospect of Scottish independence has not yet had an impact on the commercial property market, although estate agents have warned there is a “risk consideration” being made by potential investors, it was revealed yesterday.

Alan Macbeth, senior director at DTZ in Scotland said there has been “significant discussion” about the independence referendum among private and institutional investors.

He said: “So far, we are not seeing evidence of a specific price discount, although it is undoubtedly a special ‘Scotland only’ risk consideration.”

The firm, which unveiled its annual Money into Property report at an event in Edinburgh yesterday, said the effects of the property crash continued to dampen demand, with property transactions having fallen to 30 per cent of their 2007 peak in Scotland last year.

But the firm predicted that heavily indebted owners of commercial properties in Scotland will be forced into sell-offs this year, particularly after Clydesdale Bank confirmed it was pulling out of lending against property.

“The banks are continuing to deleverage from property in Scotland,” said Macbeth. “Whilst many sales have been consensual, we expect the number of non-consensual sales will increase in 2012.”

DTZ confirmed that there was little property likely to come to the market in Scotland that would be considered as “prime” by international investors, but that banks such as Lloyds and Royal Bank of Scotland would continue to sell off multi-billion pound property debt portfolios.