Research - JULY 5, 2017

U.K. remains most attractive global commercial real estate market

by Released

One in three (31 percent) commercial real estate investors say that the U.K. remains their preferred region to invest in, according to the latest BrickVest commercial property investment barometer. This number has remained the same since June 2016 despite the U.K. deciding to leave the European Union in that period.

BrickVest’s Barometer found that a quarter (24 percent) of real estate investors favor Germany as their location of choice for commercial real estate opportunities; however, this represented a fall from 28 percent in June 2016. More than one in five (21 percent) selected the United States, the same as last June, while France saw an increase from 13 percent in June 2016 to 15 percent in June this year.

The Barometer also revealed that French, German and U.S. investors are more favorable toward the United Kingdom since June last year. Nearly a quarter (24 percent) of French, a fifth (19 percent) of German and 23 percent of U.S. investors suggested they prefer the United Kingdom in June this year, representing an increase from last year across the board from 22 percent, 18 percent and 20 percent, respectively.

According to BrickVest’s investors, the average risk appetite for commercial real estate increased to 49 percent from 47 percent in June last year, meaning a sentiment shift from low to balanced risk. French investor risk appetite increased significantly from 33 percent to 55 percent, while the United States saw an increase to 50 percent (47 percent in June 2016). U.K. investor risk appetite also increased from 49 percent to 51 percent despite the decision to leave the E.U., while in Germany it remained stable at 48 percent (the same as in June 2016).

BrickVest’s Barometer also showed that the investment objective for the majority (47 percent) of its online investors is capital growth; 37 percent said their objective was income.

Despite Brexit, more than four in 10 (43 percent) BrickVest U.K. investors selected their home market as their preferred location. U.K. investors highlighted Germany as second (20 percent), the United States (19 percent) third and France (13 percent) fourth in terms of preferred locations to invest.

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