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U.K. rated as most attractive commercial real estate market

by Released 4/18/17

The United Kingdom remains the preferred region to invest in commercial real estate despite seeing a slight dip in popularity since Brexit, according to the latest BrickVest commercial property investment barometer. In March 2017 nearly one in three (30 percent) selected the United Kingdom as their preferred commercial real estate investment location, down slightly from 31 percent in March 2016.

BrickVest’s survey found that a quarter (25 percent) of respondents favor Germany as their second location of choice for commercial real estate opportunities, the same as last year.

Less than one in five (18 percent) selected the United States, which represents a fall from 21 percent last year. The same number (18 percent) also selected France although this is an increase from 14 percent in 2016.

The Barometer revealed that both German and French investors are less favorable toward the United States since March last year, however. Less than one in five (19 percent) French and the same number of German investors suggested they prefer the United Kingdom in March this year compared to 24 percent and 22 percent, respectively, last year. U.S. investor sentiment toward the United Kingdom fell marginally from 23 percent to 22 percent.

Despite Brexit and the potential of a second Scottish referendum being called in the next few years, nearly half (46 percent) of BrickVest’s U.K. commercial real estate investors selected their home market as their preferred location, up from 44 percent In March 2016, BrickVest’s U.K. investors suggested Germany was second (19 percent), the United States (16 percent) third and France (14 percent) fourth in terms of preferred locations to invest.

According to BrickVest’s investors, Average Risk Appetite Index amongst its U.S. investors remains growth oriented and relatively unchanged in the last 12 months at 56 (58 in 2016).

U.K. investor risk appetite also remained largely the same at 55 (54 in 2016) despite Brexit. This indicates that investors’ risk appetite is fairly balanced albeit slightly leaning toward the riskier spectrum.

BrickVest’s Barometer also showed that the investment objective for the majority (48 percent) of its online investors is capital growth compared to 37 percent, which said income.

The full report is available at https://brickvest.com/barometers.

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