The total value of the region's commercial property investment deals in the first three months of the year was £211.4m, down from £283m in the final quarter of 2012, but interest from London-based buyers is growing, according to Lambert Smith Hampton.
LSH's UK Investment Transactions Q1 2013 showed activity in the first quarter was dominated by one transaction, the sale of the Co-operative Group's One Angel Square to RREEF and Ginkgo Tree Investment for £142m.
Other deals included LaSalle Investment Management's acquisition of Hermes' industrial unit in Warrington for £17.2m and InfraRed Capital Partners' acquisition of Clayton Square, Liverpool for £14m.
Abid Jaffry, Northern head of capital markets at LSH, said: "While One Angel Square dominates the figures, it is indicative of a growing interest in regional offices with purchasers seeking value further North as it becomes increasingly difficult to acquire and justify central London pricing. Paradoxically, a lack of new opportunities in the North West is also creating a growing pressure on pricing and we are seeing healthy signs of investor interest in the marketplace."
The office sector accounted for 68% of total investment activity in Q1 2013 with £143.3m of transactions, a large jump from the previous quarter when the total was £36.15m. Without One Angel Square the office tally was a meagre £1.3m.
The retail and leisure sector accounted for 77% of the total market in Q4 2012 but dropped to 20% in Q1 2013 at £42.2m. The industrial sector remained steady, accounting for 12% of the Q1 market at £25.9m.
Ezra Nahome, chief executive of LSH, said: "The yield gap between prime and secondary, and London and the regions looks to have finally started to cause activity in the regions with £850m invested in portfolios of regional office, retail and industrial assets in Q1 2013.
"Pricing for secondary regional properties is starting to reach a level that makes the investment decision an easier one to justify than it was 12 or even six months ago."