Key findings from the report include: 

• Investment volumes have exceeded £150,000,000 across both Jersey and Guernsey, which is a fiveyear record.
• Take up in Jersey has exceeded 200,000 sq ft which is again a five-year record and in terms of take up as a percentage of total stock is comparable to some of the major UK regional cities.
• Occupational demand in 2018 for grade A space across the Channel Islands looks robust, however in Guernsey there is a lack of available grade A space.
• Prime headline rents in both Jersey and Guernsey have remained stable, with Jersey at around £35psf to £40 psf dependant on the lease terms and Guernsey slightly higher at around £38/£44 psf, given the shortage of supply of grade A on the Island.

According to Phil Dawes, Managing Director of D2 Real Estate, there is a "compelling case to invest." Commenting on the trend he said: “With global commercial property investment yields at all time lows, investors are looking to alternative markets for yield and value, which is why UK regional office prices and volumes have increased over the past 12 months, as yields in London and overseas have contracted. Given the close relationship between the UK and the Channel Island property market, this demand has filtered through.

“In general Channel Island office investments offer long lease terms, less rental volatility, strong covenants and yet the yields are currently at a discount to the
UK. For example UK regional office yields are now sub 5% compared to 6%- 6.5% in the Channel Islands. This provides a compelling investment case, and we expect the yield gap to shorten in 2018 particularly given the quality of the investments coming onto the market in the near future”

The D2 Real Estate 2017 Channel Islands Office Market Review is available to read online.