The overseas investor share in the Central London property market has reached an all-time high, indicating the trust shown by them in UK real estate assets. Global investors accounted for 79 per cent of all transactions in the capital between January-March 2017.
In its latest market report, BNP Paribas Real Estate UK, it is evident that overseas investors have overwhelmingly targeted core assets, predominantly the Central London offices. “However, they also continued to deploy money regionally, accounting for circa 35 per cent of total spend outside London, compared to 33 per cent witnessed in Q1 2016,” the report said.
In view of its strong fundamentals, the UK real estate sector has been able to attract international investors. The global investors are still taking selective steps up the risk curve both in the capital and in the regions, although at a much-reduced level to the same quarter in 2016. The investment strategies have varied across investor nationalities.
In terms of investor origin, Asia-Pacific funds (45 per cent) were the most active across all UK property, followed by European (24 per cent) and North American (17 per cent). The Asia-Pacific investors have largely pursued well-let, prime office assets predominantly located in Central London, several investments concerning European and North American investors are related to the acquisition of alternative use classes.
Q1 2017 saw all UK property types record positive capital growth for the first time since Q3 2014