London commercial property sales double

The Canary Wharf financial district is seen during mid-evening in East London March 26, 2009. REUTERS/Toby Melville

LONDON (Reuters) - London commercial property sales more than doubled to 1.43 billion pounds in the second quarter from the first, driven by more West End sales and an influx of overseas investors, a survey showed on Wednesday.

Property broker Cushman & Wakefield found commercial property sales in the West End, City and Docklands rose 110 percent in the April-June period, from 679 million in the January-March leg. This compared with 2.1 billion pounds in the second quarter last year.

“The central London property investment market is likely to be among the first to recover in Europe and the increase in activity is further evidence that overseas investors see value with yields at an historic high,” the survey said. In the West End, 733 million pounds of sales were recorded in the second quarter, up 250 percent from the first quarter, but down from the 928 million booked in the year-earlier period. The average lot size was 23.6 million pounds, from 14.7 million in the first quarter. Overseas private buyers accounted for 38 percent of purchases, with overseas funds behind a further 22 percent.

Clive Bull, Cushman & Wakefield’s head of central London investment, said the overseas buyers’ interest was piqued by a perception the London market was relatively good value, the lack of rivalry from UK/Irish debt buyers, and the pound’s weakness.

“The question exercising the minds of many investors, however, is whether this activity is the start of the recovery or some kind of false dawn,” Bull said in a statement.

He said the evidence suggested this activity was a nascent recovery, citing a further 275 million pounds of stock under offer in the West End and 167 million worth of deals that have exchanged but are yet to complete.

On Wednesday, Land Securities LAND.L said it had sold a key retail and office building on London's Oxford Street to a Libyan state-backed investor for 155 million pounds.

Reporting by Andrew Macdonald; Editing by Hans Peters