Logistics sector gaining ground among European real estate investment opportunities

real estate investment

Almost four in ten highlighted non-traditional sectors such as retirement homes while a third believe residential would present the biggest opportunity.

The research showed that a quarter cited retail/shopping centres while a fifth said offices and hotels equally.

Results from the research also showed that one in five would access European commercial real estate investment opportunities through a direct investment platform. However dominating this channel are REITs with more than two thirds of institutional investors saying they would use them while three fifths cited property funds. This is despite £1.4 billion being pulled from UK property funds post-Brexit.

The research also looked at the factors that have deterred investors from investing in commercial real estate in the past. Two in five highlighted that the process was too slow. A third cited the illiquidity of the market caused by not having an efficient secondary market.

Furthermore, the research showed that institutional investors believe the biggest challenge facing European commercial real estate over the next 12 months will be Brexit uncertainty, cited by 63 per cent of respondents. A further two in five institutional investors thought that low global economic growth would be the biggest challenge facing European investors in commercial real estate. A third thought the emergence of a property bubble would be the biggest challenge.

Emmanuel Lumineau, CEO at BrickVest, commented: “The research shows that the logistics sector remains front of mind for institutional investors, but also that non-traditional sectors like retirement homes are catching up.

“To generate liquidity in the market you need a great number of buyers and sellers who trust that the market is fair and regulated, with transparent pricing.

“In a background of Brexit, income is considered a priority and we prefer investments that will provide strong diversification and increased stability throughout their hold period. We have seen plenty of appetite from investors and it is clear that many of our users want to take advantage of the Brexit vote with the confidence that they have a secondary marketplace to trade.”