Capital injection: Why overseas investors could drive a recovery in the UK market
Recent investment data show that liquidity is starting to return to the parts of the UK market believed to offer the strongest growth prospects, such as logistics and residential. The continuation of this trend, however, rests on increased capital allocation to UK real estate from international investors. Is this something we can expect to see in the near term?
Analysis by CBRE Investment Management has examined the drivers and patterns of overseas capital invested in UK property over the past 20 years. This may help ascertain whether overseas investors are likely to support the UK market’s recovery. The research suggests that with UK returns poised to exceed global averages over the next five years, international capital could become a growing source of investment — if history repeats itself. Universally, correlations between UK real estate and bonds are also weak, if not negative, suggesting UK real estate could offer a diversification play for investors, as it has done