Asian investors drive UK property sales up higher than ever

SINGAPORE (May 3): 1Q17 real estate transaction volumes in the UK have hit their highest level since 2015, driven by Asian investors whose confidence remains undeterred even in the face of uncertainties regarding Brexit.

In a new report based on research conducted by property consultancy JLL, UK led the way as “the most real estate market in Europe” as well as the world’s most traded city, compared to third place in the previous year.

David Green-Morgan, head of research, global capital markets at JLL, notes that private buyers from Hong Kong and China have been the most active in London’s property market since the Brexit vote.

This comes as a result of the sterling depreciation and slight drop in capital values, which, according to Green-Morgan, means that the UK commercial real estate is now discounted by 16% on average to overseas capital since the June 2016 referendum.

“The net yield of City prime buildings is also very attractive,” adds the head of research in a press release issued by JLL on Wednesday.   

Hong Kong buyers have notably spent nearly US$3 billion (RM12.96 billion) exclusively on UK properties in the first quarter of 2017 alone, as compared to just US$842 million in 1Q16 — outspending global funds and all other foreign groups combined by nearly US$1.3 billion by snapping up offices in London’s City and West End.  

JLL also highlights how Asian buyers are also among the most active investors in the US in spite of broader political and economic certainties this year, with investors from Singapore, Japan and China driving the most activity.

“Investors from Singapore and Japan acquired offices in New York, Boston and Washington DC, as they renewed their focus on core assets in global gateway cities,” observes Green-Morgan.

Last week, IP Global identified the UK as one of the top destinations for Singaporeans looking to invest in property overseas, with 17% of Singaporeans opting for UK as the preferred investment destination in the real estate investment company’s recently-commissioned survey. — theedgemarkets.com.sg

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