Inward investment to London real estate — why is it happening and with what impact?
For international real-estate investors, London and the UK are separate countries. London belongs to ‘globalopolis’: an elite group of global mega-cities, transcending their homelands in economic importance. Since 2008, London has attracted more than £40bn of overseas real-estate investment, while the wider UK property market has languished. This has led to some misplaced and arrogant ideas. London, some say, is a first-rate city trapped in a second-rate country, and its massive real-estate investment inflows are seen as the new (and long-term) ‘normal’.
But London is not uniquely or eternally attractive to investors. Of course, it has much to recommend it: liveability, easy access to global markets, a concentration of global HQs and high-quality buildings, an extremely liquid market and a strong, improving infrastructure. These factors ensure that overseas investors choose London, rather than other UK cities. But they are not the reasons for the scale of the flows.
Those reasons are located not in London but in the countries where the money is born. The middle and far-eastern sovereign wealth funds are holding almost unimaginably vast surpluses. Equally, the recovering US economy has given US vulture and private-equity funds renewed animal spirits and firepower. In a world where bonds are too low and equities too unpredictable, the managers of this money need to find yield and diversification. Property is one answer to their problem…
If you are registered and logged in to the site, click on the link below to read the rest of the Eversheds briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Eversheds
News from The Lawyer
Briefings from Eversheds
Eversheds’ retail finance briefing is designed to keep you up to date with the latest legal, regulatory and industry developments affecting the retail finance industry.
Welcome additional form of protection for financial institutions and their employees.
Analysis from The Lawyer
Eversheds is no stranger to an international tie-up but now it’s in the market for the jewel in its global crown
Which firms are cutting it in this era of slimline rosters, and who are the GC new brooms making clean sweeps? The Lawyer can reveal all