Foreign investors are snapping up commercial property in London quicker than ever! Due to the devaluation in sterling in the last three months foreign investors have accounted for 78% of the commercial property purchased in London.

Since June over £695 million of Asian Capital has been invested in London, according to Savills Hong Kong have also been investing in the capital, European investors have purchased £482 million of Londons commercial property, and coming in second is the USA accounting for £685 million of the transactions in the past three months.

With these numbers taken in to consideration increased the number of property in London bought by overseas investors to £2.813 Billion this figure is 78% of the total amount. In the three months previous to this quarter foreign investors made for 57.8 % of the total number. This shows that post Brexit firms are continuing to invest in the UK. According Savills foreign investors accounted for 60 - 70% in previous years.

Head of the cross-border investment team at Savills, Rasheed Hassan, said prices for some London properties were 15-20% lower than three months ago.

“This has created a perception of opportunity that has placed Central London in the global investor spotlight and, as a result, international investors have been notably active with a weight of money chasing, in particular, core assets with stable income,” he said.

Savills said that because central London’s office market was facing more constrained supply and continuing demand from businesses for space, the level of international interest in the capital is sent to increase.

Head of central London investment at Savills, Stephen Down said 

"That despite uncertainty brought about by the vote to leave the European Union, the capital’s attractiveness to investors remained.

“We must be realistic of course but with prime commercial investment yields ranging between 3-6pc, the asset class compares very well against bond yields even in emerging markets, where the range is 2-6pc, and the recent interest-rate reduction and Bank of England intervention has made the arbitrage even more attractive, with debt rates at some of their lowest-ever levels.”

These figures suggest that although there was a lot of uncertainty around the leave vote, all is not lost.

(Figures taken from The Telegraph)

Author: Lauren Angell, Event Manager, CPT Events

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