Europe’s most liquid property set for €10 billion boost

Canadian and Middle Eastern investors are set to plough as much as €10 billion into European real estate, figures suggest.

Canadian investors, buoyed by a strong Canadian dollar, could invest between €3-5 billion in UK and continental Europe real estate per year, Fidelity International said, while Middle Eastern investors could make €5 billion of acquisitions this year.

Fidelity said these investors were poised to grow their European presence in the Continent’s largest, most liquid markets.

Canadian acquisitions in Europe totalled €3.4 billion in 2016 and new acquisitions were expected to focus mainly on Germany and the UK.

Middle Eastern investors were predicted to rebalance their near-term global acquisitions in favour of Germany, France and the Netherlands, and also to reduce focus on London in favour of regional UK.

Their €5 billion investments this year would be equal to the combined annual average of the past three years, said Iryna Pylypchuk, senior European real estate analyst at Fidelity International.

“The Eurozone’s ability to cope with the political uncertainty has been impressive, and with a further economic upturn in evidence in the latter quarter of 2016, another year of strong performance looks likely.”

But the abundance of capital remains the key challenge for the European real estate market, especially as French property funds and Swiss institutions seek more pan-European diversification.

Pylypchuk said the recent strengthening of interest from Canadian investors is an example of new sources of capital emerging to complement Middle Eastern and Asian investors.

Meanwhile, US investors were taking “more of a back seat”, the Fidelity analyst said in the firm’s quarterly ‘European Investment Pulse’.

Earlier this month, Cushman & Wakefield said investment in real estate globally was expected to hit $1.39 trillion (€1.3 trillion) in 2017.

©2017 funds europe

HAVE YOU READ?

THOUGHT LEADERSHIP

Innovative US companies are providing some of the solutions to the climate crisis and transition to a more sustainable economy. We see potential opportunities in areas including renewable energy and…
FIND OUT MORE
This white paper outlines key challenges impeding the growth of private markets and explores how technological innovation can provide solutions to unlock access to private market funds for a growing…
DOWNLOAD NOW

IRELAND SPOTLIGHT

Visit our dedicated Ireland channel for all the latest news and analysis on the country's investment industry.
READ MORE

PRIVATE MARKETS FUND ADMIN REPORT

Private_Markets_Fund_Admin_Report

LATEST PODCAST