International investors committed to UK despite Brexit, survey suggests
Global international investors remain committed to the UK real estate market despite the ongoing uncertainty over Brexit, new research has found.
A survey of 60 of the world’s leading institutional investors, who together manage over $600 billion in real estate assets, at the RE-Invest Summit at MIPIM Cannes found that 46% intend to continue with the same level of investment in UK property following the triggering of Article 50 which began the process of the UK’s withdrawal from the European Union.
Meanwhile, the survey, undertaken by KPMG, found that 44% of respondents said their organisations would slow down investment in the UK, while only 10% said they expected to stop investment altogether.
When asked which cities would be likely to benefit from increased inward investment as a result of the UK leaving the EU, some 30% stated they did not believe Brexit would have a material benefit on any other city, with London expected to retain its preeminent status as a global financial centre, regardless of whether the UK is in or out of the EU.
Some 23% said that Frankfurt is likely to be the main beneficiary of Brexit and 22% said Dublin. Some major companies have already signalled that they might move to these two cities so that they have a presence within the EU.
Ronan Vaspart, director of MIPIM events, said that the survey demonstrates the continuing strength of the appetite among global real estate investors for opportunities in the UK real estate market, despite ongoing economic and political uncertainty, and highlights issues that will be explored in detail at MIPIM UK in October.
‘The issues and challenges the UK is facing, alongside the opportunities, will be explored in depth during MIPIM UK, which brings together investors, developers, local authorities, government and leading figures from across the property industry,’ he added.
MIPIM UK will also host an Investors’ Summit and a Mayor’s think tank and will feature leading thinkers and speakers from across the property industry, as well as politics and economics.
Andy Pyle, UK head of real estate at KPMG, pointed out that what Brexit means for the real estate sector remains unknown long term, unfolding day by day. ‘That’s why there is a vital need to be prepared for the unexpected,’ he said.
‘Uncertainty naturally has an impact on the industry’s attitude towards investing in the UK, but these attitudes also vary by investor, the origins of capital, investment strategy and the stance on Brexit,’ he added.