- London remains the top city destination for Middle Eastern property investment, says CBRE.
- Oil-rich sovereign wealth funds remain the main source of capital for investments from the Middle East, representing $US5.4 billion of outbound investment from the region.
- International investors purchasing commercial property in London appear to have been largely undeterred by the Brexit vote.
LONDON — London remains the top city destination for Middle Eastern property investment despite Brexit-related uncertainty, according to a report.
Middle Eastern investors spent £1.28 billion ($US1.68 billion) on commercial London property between Q2 2016 and Q2 2017, according to CBRE’s Middle East “In and Out 2017” report.
New York ranked second at £625 million ($US820 million), while Washington D.C. ranked third with £357 million ($US469 million) of investment.
As with previous years, oil-rich sovereign wealth funds remain the main source of capital for investments from the Middle East, representing $US5.4 billion of outbound investment from the region from a total of $US10.1 billion, although they decreased 17% year-on-year.
International investors purchasing commercial property in London have been largely undeterred by the Brexit vote, and remain attracted by the high demand, long leases, and strong yields in the capital.
Chris Brett, CBRE UK’s head of international capital markets, said London’s position as a “gateway city” and a cheap pound continue to drive investment.
“London and the UK remain a pre-eminent market for global capital despite ongoing political uncertainties,” Brett said.
“In the past year we have seen Middle East investors securing opportunistic acquisitions in the capital, most notably family wealth from ultra high-net worth individuals and sovereign wealth funds.”
“Whilst this has partly been driven by a correction in yield levels and a favourable currency effect due to the depreciation of sterling, it reaffirms London’s status as a global gateway market,” he said.
Business Insider Emails & Alerts
Site highlights each day to your inbox.