The latest figures show foreign investment is driving a rise in commercial property deal values in London, suggesting the capital is retaining, or even increasing, its reputation as a safe haven for commercial property investment.
New data from real estate advisers Cushman & Wakefield shows that the value of hotel, shop and office sales in London rose to £13.6 billion in 2012, a staggering 25 per cent improvement on sale values in 2011. The increase means 2012 was the strongest year for London commercial property investment since 2007, with three quarters of purchases being made by foreign investors.
Much of this investment is coming from Asian governments looking for a safe, long-term asset – with Malaysian government-backed funds leading the charge. Meanwhile, other wealth funds from countries like Indonesia, Korea, China and Singapore have all also put their cash into London commercial property, with areas such as Canary Wharf, the City and the West End proving the most popular.
Reports from the Financial Times claim that the increase in investment in London has widened the gap between the capital and other areas in the UK, in terms of commercial property deals. Outside London, commercial sellers are struggling to attract any foreign interest and funding for UK buyers remains scarce.
Some of the high profile – and high value – deals involving investors in the past year have include the purchase of Battersea Power Station, the UK Deutsche Bank headquarters in the City and the Chiswick Park office development in West London.
[p1]Proto[/p1][p2]papas[/p2] [p3]Solicitors[/p3] specialises in high value commercial property acquisitions in Central London. To view some of the buildings we acquired for clients visit our Property Gallery.
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