Investor risk appetite rises as UK remains most attractive global commercial real estate market

real estate

One in three commercial real estate investors say that the UK remains their preferred region to invest in, according to a new commercial property investment barometer.

This number has remained the same since June 2016 despite the UK deciding to leave the European Union in that period.

The Barometer found that a quarter of real estate investors favour Germany as their location of choice for commercial real estate opportunities; however, this represented a fall from 28 per cent in June 2016. More than one in five selected the US, the same as last June, while France saw an increase from 13 per cent in June 2016 to 15 per cent in June this year.

The Barometer also revealed that French, German and US investors are more favourable towards the UK since June last year. Nearly a quarter of French, a fifth of German and 23 per cent of US investors suggested they prefer the UK in June this year, representing an increase from last year across the board from 22 per cent, 18 per cent and 20 per cent respectively.

According to BrickVest’s investors, the average risk appetite for commercial real estate increased to 49 per cent from 47 per cent in June last year, meaning a sentiment shift from low to balanced risk. French investor risk appetite increased significantly from 33 per cent to 55 per cent while the US saw an increase to half. UK investor risk appetite also increased from 49 per cent to 51 per cent despite choosing to leave the EU while in Germany it remained stable at 48 per cent.

The research showed that the investment objective for the majority of its online investors is capital growth compared to 37 per cent which said income.

Despite Brexit, more than four in ten BrickVest UK investors selected their home market as their preferred location. UK investors highlighted Germany as second, the US – third and France – fourth in terms of preferred locations to invest.

Emmanuel Lumineau, CEO at BrickVest, commented: “Despite a series of significant events over the past 12 months including Brexit, our latest Barometer shows the UK remains the preferred location to invest in from our global investor base. Since the vote in June last year, we’ve seen a 72 per cent increase in the number of investors joining the platform and are seeing plenty of appetite from investors for property as an asset class.”

“Our first exit echoes not only the strong level of returns we are generating but the quality of the investments BrickVest selects for its platform. For the first time ever private investors can access the same investment opportunities as large institutional investors such as pension funds and insurance companies. BrickVest is a truly pan-European platform that offers unique levels of liquidity to a traditionally illiquid asset class. Our users appreciate the transparency, simplicity and ease of investing which has enabled us to focus on our specialist deal sourcing capabilities.”