A low pound, the sustained ‘safe haven’ status of the UK, and the attractions of high yields, lifestyle, emigration possibilities and education have kept overseas investment in UK property at peak levels.
As 2017 begins, the flow of investment into UK real estate is likely to accelerate, according to a series of new reports.
A US$2 billion deal to create a residential acquisition and rental business in London was announced by Qatari Diar Real Estate (part of Qatar Investment Authority) in 2016. Aiming to develop a portfolio of 4,000 homes, it will add to the substantial Middle Eastern presence in the UK capital.
Qatar already owns The Shard and Canary Wharf towers in London, along with many other landmark buildings, while the Abu Dhabi Investment Authority owns the Lanesborough Hotel and a Kuwaiti investment arm owns City Hall, housing the Mayor of London’s offices.
Emirati investors own 5 per cent of Mayfair, according to a new survey, alongside American, Swedish, Hong Kong and Chinese investors with 5 per cent each. European investors have 16 per cent, meaning that UK-based entities comprise less than 60 per cent of the region’s owners.
Chinese investment stands to increase dramatically in the coming years, according to real estate professionals. The current US$50 billion a year spend “is likely to be anywhere from two to four times the size in 10 years’ time,” said one.
This additional demand for UK investment property is likely to increase pressure on prices.
