Today marks the start of the traditional Autumn selling season in the commercial property market. It comes at the end of an unusually busy summer season which saw the highest level of activity for July and August on record in the investment market.
Marie Hunt, head of research and executive director with CBRE, said the summer months were normally the quietest where property companies would prepare assets for sale in the last months of the year, but this year there was a quite a lot of summer activity. "On top of that we're going into a busy Autumn season. It's partially NAMA offloading stock, but also deleveraging from other financial institutions. And this year there is the expected end of a capital gains tax waiver which is putting additional pressure on the market," Ms Hunt said.
She said she believed there was sufficient activity in the market to warrant the ending of the Capital Gains Tax waiver without having a detrimental impact on next year's activity. "There is the possibility that Minister Noonan will extend the waiver but it's not likely," she said. Marie Hunt said a key trend in the market in recent months is that it is no longer just Dublin where properties are changing hands. "Another key trend is that it's not just office blocks, but shopping centres and retail parks are selling too. We saw the recent interest in Project Acorn, a portfolio of three shopping centres. We expect more to come and there's strong demand," she added.
Ms Hunt said there was a broad mix of buyers in the market at the moment with some domestic buyers making acquisitions below the radar. "The trophy deals tend to involve overseas buyers which dominate the headlines. However, there are domestic buyers there, some of them in joint ventures with overseas investors." A key feature of the next few months would be the volume of properties coming on stream, but also the amount of land to be traded, she added.
MORNING BRIEFS - Trade figures from Brazil, which would normally not be of much interest, are out today. However, figures on Friday indicated that Latin America's biggest economy went into recession in the first half of the year. Investment fell sharply and the country's hosting of the World Cup had a dampening on economic activity. That contrasted with another BRICS country, India, where the economy grew by 5.7% in the three months to June. It was the fastest pace of growth in two and a half years and much greater than expected.
***Manufacturing activity here grew at its fastest pace in 15 years in August, according to the latest figures from Investec Bank. Output and new orders rose sharply and that encouraged firms to increase their inputs and take on new staff. In fact, the employment index shows that the manufacturing sector has increased headcount in each of the past 15 months.
*** Builders merchanting and DIY Group, Grafton, has announced the acquisition of Direct Builders Merchants, a UK based general merchanting business. The group trades from three branches in the southeast of England and will increase Grafton's reach in the region.
*** The new iPhone6, which is widely expected to be launched next week, is reported to have a mobile wallet function. Bloomberg is reporting that the tech company is in talks with major payment networks, banks and retailers, including the likes of Visa, Mastercard and American Express.