Large lots dominate 2017 West End transactions as average deal size hits £132 million - Savills

28 March 2017

London’s West End saw a total turnover of £475million across just four transactions in February 2017 as the average deal size reached £132million, says international real estate advisor Savills.

Just 10 deals were recorded in the market in January and February 2017, according to the firm, compared to 24 in 2016, however the combined turnover for the two months of £1.3billion  is 50% up on the five year average of £871million. According to Savills, the average West End deal size in 2017 currently stands at an unprecedented £132million. This compares to the annual average deal size of £46million in 2016. 

Savills says it has identified approximately £3billion of potential West End sales this year, with approximately £2.2billion of these being of UK origin, 60% of which could be from UK institutions and up to a quarter from overseas capital.

Paul Cockburn, director in the Central London investment team at Savills, comments: “Low transaction numbers but large lot sizes has been the theme of 2017 to date. Investor demand continues to outstrip supply with assets going under offer almost as soon as they’re marketed.

“The lack of likely overseas vendors this year is attributable to two factors: firstly the cost of repatriating the money in line with the movement in currency against the pound in the past eight months, and secondly the difficulty in buying back into the London market.”

Savills says prime yields in London’s West End market remain at 3.25%.

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Key Contacts

Paul Cockburn

Paul Cockburn

Director
Central London Investment

Savills Margaret Street

+44 (0) 20 7409 8788

 

Kirsty Moseley

Kirsty Moseley

Associate Director
Commercial Marketing & Press

Savills Margaret Street

+44 (0) 207 409 8887