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PERE – UK Roundtable 2018

Facing the music

There may be trouble ahead for the UK real estate market, but investors must find ways of deploying their capital nonetheless. Stuart Watson reports

The British like the image of a nation of people who soldier on with a stiff upper lip no matter how dark the outlook. It is a cliché that could be applied to Theresa May’s government, which, at press time, was still staggering on bravely, or some might argue perversely, in the face of a variety of political blows, Brexit-related and otherwise, and worsening economic data. It could also describe the UK real estate investment market, which, despite the obvious political headwinds, has remained remarkably robust. UBS calculates the 2017 all-property total return for UK commercial real estate at a vigorous 10.3 percent, and the early months of 2018 have continued in the same vein.

And yet black clouds are visible on the horizon. The possibility of a breakdown in Brexit talks with the EU remains a very real possibility. GDP growth in the first three months of 2018 was a sickly 0.1 percent, tweakest quarterly figure for five years. Roll that backdrop together with a property market that has never looked so expensive and it is unsurprising that the five real estate professionals gathered at the Shard building on London’s South Bank for PERE’s UK roundtable strike a cautious note.

The quintet comprises four asset managers: Andrew Angeli, head of European strategy and research at CBRE Global Investors; Jeremy Bishop, co-founder of Oxenwood Real Estate; Kiran Patel, chief investment officer at Savills Investment Management; and David Skinner, global head of strategy and portfolio management at Aviva Investors; as well as lawyer Steven Cowins of Greenberg Traurig, who is hosting.

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