Non-European commercial property investors are pushing out from the UK and into other parts of Europe and last year helped drive investment to its highest level seen.
The UK’s share of non-European real estate investment slipped from 53% in 2013 to 44% in 2015, with Germany the main beneficiary – though Ireland, Spain and Italy also saw an increase.
Research shows that European commercial real estate investment from all sources totaled €264 billion in 2015, a greater sum than in any previous year. The previous peak was €230 billion in 2007, according to Cushman & Wakefield, a property services firm.
Compared to 2014, non-European investors increased their investment in European real estate by 32% to €76 billion and made fewer sales of property than investors based in Europe.
Nigel Almond, director of research at Cushman & Wakefield, said: “Whilst the volume of non-European investment continues to grow across all markets, the balance of power is now shifting away from the UK and London.
“With many non-European investors having established their presence in the UK, they are now pushing out with more vigour into the continent. Peripheral markets – Ireland, Spain and Italy – attracted a further 10%.”
The UK attracted the largest flows for all sources in total, in line with previous trends, but Germany, Italy, Spain and Portugal also saw a surge in funding for real estate projects as investors diversified portfolios.
Year-on-year increases in investment levels from all sources, not just non-Europeans, in some of the major markets last year were:
- Germany €53 billion, up 41%
- Italy €8 billion, up 67%
- Spain €11 billion, up 36%
However, Central and Eastern Europe saw just a 6% rise to €6.8 billion in 2015, although the region, and Poland in particular, experienced a strong final quarter.
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