U.K. investors are having second thoughts on buying commercial real estate in Scotland.
According to Financial Times, U.K. investment in Scottish commercial real estate has declined abruptly this 2015 since investors began to worry about the independence debate. A data from Savills, shows that foreign investors have dwindled but not as sharply. Back in 2014, £1.2 billion of investment from U.K. investors was recorded during the period of January and August. In the same period for 2015, it was reported that U.K. investors has only invested a total of £800 million in Scottish commercial real estate.
Speaking of this, Edinburgh-based JLL Director Alasdair Humphrey said, "Independence is back on the agenda . . . and you do detect a degree of angst from some of the London-based investors."
He continued, "For international investors, Scottish independence is just a blip on a global horizon."
The resurgence of the Scottish National Party following its defeat in the 2014 independence referendum ignited doubts on the constitutional future of the nation. Speaking of this, Savills Director Mat Oakley of European commercial research remarked, "Some non-domestic investors are clearly less concerned by the constitutional issues than some domestic investors."
Oakley pointed out that there are other factors in the decline in domestic investment. He also cited the decline in investments in north-west England. He noted that last year's high volume of investment in Scottish real estate was the outcome following the unusual volume of large properties offered for sale. He said, "These markets are driven by availability of stock."
According to Financial Times, Humphrey believes that the fall in domestic investment for 2015 should not be blamed on concerns about independence. Independence was only one factor and that market statistics were easily moved by some big deals. However, analysts believe that U.K. investors outside of Scotland are the most anxious group.