The UK remains the preferred region to invest in commercial real estate despite seeing a slight dip in popularity since Brexit, according to the latest BrickVest commercial property investment barometer (‘the Barometer’). In March 2017 nearly one in three (30%) selected the UK as their preferred commercial real estate investment location, down slightly from 31% in March 2016.
・In the latest BrickVest commercial property investment barometer, 30% of investors selected the UK as their preferred location, albeit down slightly from 31% in Q1 2016.
・ 25% favour Germany as their location of choice and 18% for US and France.
・ Risk appetite amongst US and UK investors is at 56 and 55 meaning that investors are fairly balanced albeit leaning towards the riskier spectrum.
・Investment objective for 48% of investors is capital growth and for 37%, income.
BrickVest’s survey found that a quarter (25%) of respondents favour Germany as their second location of choice for commercial real estate opportunities, the same as last year. Less than one in five (18%) selected the US which represents a fall from 21% last year. The same number (18%) also selected France although this is an increase from 14% in 2016.
The Barometer revealed that both German and French investors are less favourable toward the UK since March last year, however. Less than one in five (19%) French and the same number of German investors suggested they prefer the UK in March this year compared to 24% and 22% respectively last year. US investor sentiment towards the UK fell marginally from 23% to 22%.
Despite Brexit and the potential of a second Scottish referendum being called in the next few years, nearly half (46%) of BrickVest’s UK commercial real estate investors selected their home market as their preferred location, up from 44% In March 2016. BrickVest’s UK investors suggested Germany was second (19%), the US (16%) third and France (14%) fourth in terms of preferred locations to invest.
According to BrickVest’s investors, average risk appetite Index amongst its US investors remains growth oriented and relatively unchanged in the last 12 months at 56 (58 in 2016). UK investor risk appetite also remained largely the same at 55 (54 in 2016) despite choosing to leave the EU. This indicates that investors’ risk appetite is fairly balanced albeit slightly leaning towards the riskier spectrum.
BrickVest’s Barometer also showed that the investment objective for the majority (48%) of its online investors is capital growth compared to 37% which said income.
Source : BrickVest