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Record levels of Asian investment into European real estate set to continue in 2018

11 April 2018

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  • Research by Intertrust identifies UK as top target real estate market for Asian investors despite economic uncertainty
  • More than two thirds (68%) of real estate professionals believe the volume of Asian investment in European real estate assets will increase over the next two years
  • China remains the largest investor in European real estate, but South Korea and Singapore have been increasingly active

The majority (67%) of real estate professionals expect the volume of Asian investor capital entering the European real estate market to increase over the next two years, according to a new report commissioned by Intertrust, a leading global provider of high-value trust, corporate and fund services. In contrast, just 7% of respondents think that volumes will fall.

The research highlights the ongoing attraction of European Real Estate to international investors. Respondents cited Europe’s ‘safe haven’ status, the continued search for yield and the continued high demand among non-banks such as Asian Sovereign Wealth Funds as the top three drivers behind investment in the region.

Despite persistent Brexit uncertainty, the findings suggest that the UK will retain its position as the top market, with 56% of respondents predicting it will see the biggest increase in Asian capital flows, followed by the Nordics (48%) and the DACH (Germany, Austria and Switzerland) region (37%). The extent to which these regions close the gap on the UK will be a key trend to watch over the next two years.

Jon Barratt, Head of Real Estate at Intertrust said, “Although 2017 was noted for record-breaking volumes of Asian capital pouring into European commercial real estate, our findings suggest that there is still more to come. While China remains the largest investor, South Korea and Singapore have been increasingly active.”

“Record high valuations have fostered an intensely competitive environment for European real estate between global investors from Asia, the US and Europe. Growing Asian demand is welcome news for investors looking to sell assets but less welcome for those looking to extend their exposure to bricks and mortar.”

To read the full research report, click here.