According to D2 Real Estate's latest research, commercial office investment volumes in the Channel Islands achieved a new record in 2019.
Around £220million worth of stock was traded last year, up from £185m in 2018.
High value residents were the most active investors, along with overseas investors and syndicates.
Given the demand, the prices achieved during the past year have increased, closing the gap between the Channel Islands and the UK.
In comparison, given all the political uncertainty, investment volumes in the UK regions fell by approximately 30%, with investors delaying decisions until the outcome of the General Election was known.
"I am very positive about the market in Guernsey," said D2 Real Estate Managing Director, Phil Dawes. "There has been a lot of activity over the past 12 months and sites that have lain dormant for many years have now been acquired by entrepreneurial developers.
"Perhaps the most positive aspect over the last 12 months is the development of the next phase of Admiral Park, comprising a hotel - pre-let to Premier Inn - food and beverage units, and a 30,000 sq. ft office building. This would be the first office development in ten years or so.
In terms of the investment market, Mr Dawes added: "The investment market throughout the Channel Islands has been extremely strong over the past 12 months and prices are rising. If we are going to deliver high quality, environmentally friendly office stock, having an active and diverse pool of investors is really important, as rents are struggling to keep pace with building cost inflation, which is putting pressure on developer's margins, so further yield compression is vital.
In terms of the occupational markets, he believes both Guernsey and Jersey operate in different cycles.
"Letting activity fell significantly in St Helier during 2019, mainly because there is virtually no good quality stock left to let, despite the unprecedented level of development activity over the past few years," Mr Dawes continued. "In contrast, St Peter Port's take up is broadly in line with the five year average. However, given the volume of new and refurbished stock coming to the market, we expect take up to be stronger in 2020."
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