UK commercial real estate
Britain's vote to leave the European Union has thrown a lot of previously held certainties into doubt. One immediate practical consequence has been a weakening of sterling, which has already resulted in a significant price reduction in UK real estate for non-UK buyers. That, combined with the withdrawal of some competitors from the market (particularly those dependent on borrowing) means that many international investors with available funds will see the coming weeks and months as a 'window of opportunity'.
In the last couple of months, with pension funds and other financial institutions biding their time, many UK and non-UK private investors have taken advantage of a softer market. They have found it easier to win competitive bids for properties and consequently we have been busier than ever buying commercial real estate for investors. While talk of a 'Brexit bonanza' may be an exaggeration, we believe that this trend is likely to continue.
In a world of record low bond yields and tumbling stock markets, the fundamentals of UK commercial real estate retain their appeal: limited supply and sustained demand, London's unique positioning as a world city, and the continuing unusually generous tax treatment of non-UK investors. And now, during this current phase of change, pricing is looking much more attractive.