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Beijing £º2017-09-23 01:00:27

London set for ¡ê21.6bn property boom

2017-09-04
Brief: London¡¯s property industry struck a bullish note on Friday ¡ª forecasting investment would surge past ¡ê20 billion this year.
Mega spend: Investors are expected to fork out more than £20 billion for central London commercial property this year Dan Kitwood/Getty Images
 
London’s property industry struck a bullish note on Friday — despite fears that Chinese tycoons are cutting back — forecasting investment would surge past £20 billion this year.
 
An estimated £21.6 billion will be spent on central London offices, shops and leisure properties, including gyms and cinemas in 2017, according to data compiled exclusively for the Evening Standard.
 
Colliers International’s figure is up 36.7% from the £15.8 billion spent on commercial property last year, when jitters rocked the sector in the wake of the Brexit vote.
 
In the first half of the year, Chinese money was behind £4.7 billion of purchases in the capital, including a £1.1 billion swoop for the Cheesegrater skyscraper. Investors have been enticed by the weaker pound and steady rental income.
 
But last month Beijing issued rules to limit overseas property investments, and alarm bells rang shortly after when Chinese developer Dalian Wanda ditched plans to spend £470 million on a deal in Nine Elms.
 
ichard Divall, Colliers’ head of cross-border capital markets, said a restriction of Chinese investment could see some prices cut to attract new buyers. But, he added: “A little re-pricing just unleashes another raft of new entrants.”
 
Brian Bickell, the chief executive of Chinatown and Carnaby Street landlord Shaftesbury, also played down concerns about less investor appetite for London. “Investment interest is, and always has been, truly global,” he said.
 
“The interest from any one source is never constant — it ebbs and flows, usually due to their local circumstances rather than changing views on London.”
 
Chinese investors are said to be eyeing a deal for Lloyds bank’s headquarters in the City. And Gregor Wallace, of investment group Coldwell Banker Commercial, says he has clients in the US, UAE and Lebanon all looking for London office buildings starting at £50 million.
 
Property developer Exemplar’s boss Daniel Van Gelder said:  “We’re still being barraged with requests by international investors to work with them in London.”
 
BNP Paribas Real Estate’s senior director in international investment, Andrew Cruickshank, said: “We expect the investment market to remain strong throughout 2017 and into 2018."
 
Recent sales include US investor Thor Equities and real estate firm AEW, on behalf of German backers, forking out £180 million for the New Oxford Street office of talent agency WME.


¡¡¡¡Source: EveningStandard
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